More than 2.1 million British adults aged between 55 and 64, around 44% of non-retired adults in this UK age group, do not know when they will be able to retire, according to recent research (August 2012) published by Baring Asset Management (Barings), the international investment management firm.
The study found that nearly two fifths (38% or 13.5 million people) of all non-retired adults do not know when they will be able to retire, while 12% (equivalent to 4.3 million people) do not plan to retire at all. The results of this year’s Barings survey are in stark contrast to the results from before the financial crisis in 2008. Back then, almost 100% of non-retired respondents stated that they were confident about being able to retire, with only 1% saying that they did not know at what age they would be able to do so.
The level of confidence that people had five years ago about when they would be retiring has declined, nowhere more obviously than for those who are late in their working life and approaching state pension age. We seem to have shifted dramatically from an age of confident expectancy to one of uncertainty. In this context, it is not surprising that the lack of personal planning might now have much to do with people not having clear ideas about what the future holds for them, reinforcing a ‘put off ’til tomorrow’ attitude. Coupled with an estimate that over a third of non-retired adults do not have a pension plan, this must contribute to a growth in future retirement issues for increasing numbers in the working age population.
The research has also identified a significant change in outlook for people closest to retirement age (i.e. those aged 55–64) in just the last year. In 2011, 30% of respondents in this age category, equating to 1.5 million people, were unable to say at what age they planned to start retirement. Today, this figure has increased to 44%, translating as 2.1 million adults. This jump equates to some 660,000 more adults of retirement age not knowing when they will be able to stop working, compared with last year.
Of those that plan to retire over the age of 65, almost two thirds are men (65%), suggesting that proportionally they are likely to retire later. Of the 4.3 million (12% of all non-retired British adults) with no plans to retire, 17% are in Wales and the South West, whilst only 7% of people in Scotland have no plans to retire. In conclusion, however, a lack of action on the retirement and pension planning front is clearly a widespread and growing problem across the UK, don’t let inertia and procrastination ruin your retirement.