One in five or 18 per cent of UK employees and 32 per cent of those aged 55+ have deferred their retirement date since the pandemic.
According to Close Brothers’ Workplace Financial Wellbeing report, 23 per cent of employees are changing their retirement date due to pandemic-induced uncertainties.
The report found that the pandemic has increased uncertainty about retiring due to the ensuing economic uncertainties. Recently, 23 per cent of all workers changed their retirement date, and 18 per cent decided to postpone it.
Moreover, one in three workers aged 55 and above who were almost ready to retire, made adjustments, mostly delaying it. Individuals over 55 who postponed retirement did so because of financial limitations. On the other hand, 47 per cent of the same group who are pushing forward with their retirement date frequently say that “life is too short.”
Concerns about not being able to afford retirement are common, especially among those 55 and older, the percentage rises to 41 per cent. The amount of people planning for retirement is dropping with 10 per cent of workers not having any retirement plans at all, and one in four acknowledge that their plans are not on track. Additionally, 27 per cent of workers over 55 believe their retirement plans aren’t going as planned right now.
Close Brothers head of workplace financial wellbeing Jeanette Makings says: “Our report shows that anxiety has increased significantly when it comes to retirement decisions. It’s a weighty responsibility and the impact of getting it wrong is immense; it’s understandable people are feeling the pressure. And now, with the possibility of a one pot pension, and yet more control being put into the hands of employees, the need for support, guidance and advice has never been more critical.
“The good news is that there are some simple solutions and employers are perfectly placed to help. The biggest swing factor is affordability; more than half (54 per cent) of employees say that knowing they could afford to retire, and when, would bring certainty and security. The other biggest drivers, within employees’ control, are knowing what they will get in their State Pension (25 per cent), paying off their mortgage (29 per cent) and understanding their choices and making better decisions.
“Employers, as part of the support provided in their financial wellbeing programme can easily help with all of these: providing a financial education programme, financial guidance and access to financial advice; linking to a pension savings tool, the State Pension forecast and a budget modeller alongside some guidance on living standards in retirement; and introducing a mortgage advice service, to help employees reduce their mortgage burden.”
