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- Could flexible working impact your retirement plans? Take our survey below
One in 10 workers would be willing to delay or slow down their retirement thanks to improved opportunities to work from home or choose their own hours, research reveals.
Flexible working has become much more common since the pandemic. However, also due to COVID-19, there is now a labour shortage, as many older people have stopped working for good.
Among those reconsidering retirement, 60 percent said changing work practices allowed them to make a slower transition to retirement, for example by working part-time.
And about 23 percent have completely postponed their plans to suspend work, according to research from advisory network Wesleyan Financial Services.
Flexible rules: Working from home has become much more common since the pandemic
During the pandemic, some older workers took the opportunity to retire early, while others were forced to quit for reasons such as redundancies, their own ill health or caring duties.
Wealthy people are most likely to retire early and poorer workers to quit for health reasons, while those in the middle keep going well into their 60s, according to previous research by the Institute for Fiscal Studies think tank.
The previous Conservative government tried to encourage 50-somethings to stay or return to the workforce with measures including improved pension tax breaks.
The new Labour government is also expected to try to address the current gap in the workforce left by older workers as part of its bid to boost economic growth.
Research from Wesleyan Financial Services found that 26 percent of those over 55 have either “unretired” or are planning to do so and take up paid work again.
Among this group, 22 percent do it for money, 19 percent to keep their brains active and 13 percent to give themselves a greater sense of purpose.
Wesleyan, which surveyed 2,000 people aged 55 or older, also found that 28 percent of them had not checked whether reducing hours or working part-time would affect their pension.
Managing director Linda Wallace said: ‘Any changes to retirement plans, whether a slower transition to retirement or bringing forward the retirement date, can have financial and personal implications.
Delaying retirement, for example, may give you more time to build up retirement savings and investments, but it may also mean having to postpone personal ambitions or projects.
‘On the other hand, accelerating retirement may mean you need to stretch your savings for longer, but it may also mean you are free to pursue other activities, including different types of work or spending more invaluable time with your family or loved ones.’
How to put your pension in order if you fear that it won’t be enough
1) If you are worried that you have not saved enough, Research your existing pensionsIn general terms, the following questions need to be asked of the schemes:
– The current value of the fund.
– The current transfer value – because there could be a penalty for moving it.
– Whether the pension is a final salary or defined contribution pension. Defined contribution Pensions take contributions from both the employer and the employee and invest them to provide a pot of money at retirement.
Unless you work in the public sector, they have now mostly replaced the more generous gold-plated watches. defined benefit – career average or end-of-career salary – pensions, which provide a guaranteed income after retirement until you die.
Defined contribution pensions are more stingy and savers bear the investment risk, rather than employers.
– Whether there are any guarantees (for example, a guaranteed annuity rate) and whether you would lose them if you moved the fund.
– Your pension forecast at retirement age. You can use a pension calculator to see if you will have enough; these are available online.
2) You need to add the predicted figures to what you expect to receive in state pension, which is currently £221.20 per week or around £11,500 per year if you qualify for the new full rate. Get a state pension forecast here.
3) If you are tempted to merge your old pensions, read our guide first to make sure you won’t be penalized.
4) If you have lost track of the old pots, The Government’s free pension tracking service is here. Our retirement columnist, Steve Webb has a guide to finding lost pensions here.
Be careful if you do an online search for Pension Tracing Service as many companies using similar names will appear in the results.
These will also offer to look for your pension, but they will try to charge you or sell you other services, and they could be fraudulent.
