A third of us fear that we’ll have to work until we drop
THE state pension age will shortly start climbing to 67 but millions are likely to work much longer than that as one in three Britons fear they will never be able to afford to retire.
Eight in 10 are concerned the cost-of-living crisis will force them to work longer to make up for a shortfall in savings, while others will fall behind as they may have to halt pension contributions to cover essential living costs.
The UK’s new work-until-you-drop culture is growing despite the success of the auto-enrolment pension scheme, which launched over a decade ago, giving more than 10 million lower-paid employees a workplace pension for the first time.
Worryingly, growing numbers are planning to make early pension withdrawals, too. This is allowed from age 55 under 2015’s pension freedom reforms, and will further deplete their pots. Only a handful of savers are sharing their retirement concerns with a qualified adviser or the free government guidance service Pension Wise, said Jonathan Watts-Lay, a director at pension adviser WEALTH at work.
He urged those approaching retirement to examine their pensions, savings and investments to see if they are going to be enough: “Once you know your situation, you can decide what to do about it.”
Watts-Lay urged workers to keep contributing to their pension if they possibly can, despite today’s challenges: “Stopping pension payments really should be a last resort if you are facing serious financial difficulties.”
The short-term savings will be small but the long-term impact of lost employer pension contributions and tax relief will be huge, he added.