As the state pension age rises and life expectancy increases, it looks likely that more workers will remain in employment for longer to be able to build up sufficient funds for their retirement years.
According to an analysis by Aviva¹, the number of people retiring before they reach age 65 is decreasing rapidly. The insurer calculates that if the present rate of change continues, by 2035 almost no one will be able to retire early. Figures from the Office for National Statistics show a record 10.1 million over-50s remain in work, with 1.2m of these workers aged over 65.
How to make the right moves for a comfortable retirement
Increased life expectancy means that people retiring at 65 today can reasonably expect to live on into their 80s if not longer, and some can expect to live to 100.
That’s why it makes good sense for employees to keep an eye on their pension arrangements, especially if they intend to retire earlier rather than later. Key questions for the employee to address are:
- When do I want to retire?
- How much will I need in income and savings to fund my lifestyle in retirement
- Are my plans on track?
- Am I currently saving enough?
Although it has recently been increased, the state pension is still only a basic safety net for most people, and not enough on its own to guarantee a comfortable retirement.
As part of the government’s drive to ensure we all make adequate provision for retirement, employers are now legally obliged, subject to age and earnings thresholds, to automatically enrol their employees into a qualifying pension scheme, where employees and employers make monthly contributions.
Taking advice can help you meet your goals
The need for professional advice or guidance has never been more important. As an employer where pension costs could be as much as 3% of payroll, why not increase the return on investment by educating and engaging employees.
Support your employees to keep on track for a financially comfortable retirement.
Find out how by Booking in for a chat at The Benefits Lab.