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Active Baby Boomers beating the retirement blues

Almost half (49%) of people plan to work beyond their preferred retirement age, according to a new study by financial mutual Wesleyan.

This follows last week's report from the World Economic Forum which recommended the UK retirement age should rise to at least 70, which will be the norm by 2050, to prevent a pension time bomb[i].

But Wesleyan's research [ii] shows people are already choosing to work into their old age - and not just to ease money worries.

The study found that for baby boomers [iii] currently or planning to work past retirement age, almost half (47%) are doing so to keep active. More than a third (34%) say they would be bored if they weren't working.

While having an income is still the most common reason to stay in work (cited by 52% of those surveyed), it's clear that for many over-55s a broader set of motivations come into play.

The picture is very different, however, for those aged 16-34 who are acutely aware of the financial need to work past retirement age. The majority (58%) believe they'll find it harder to finance their retirement than previous generations, compared with just a third (33%) of over-55s asked the same question.

In the UK, the state pension is due to rise to 68 by 2046, and a report for the Department for Work and Pensions in March found that under 30s might not get a state pension until they are 70 [iv].

Despite millions of Britons now having pensions through auto-enrolment, not putting enough money away is still the top retirement concern, according to Wesleyan. This worry is particularly prevalent among those aged 16-34 (53% vs 31% of over-55s).

Vicki Wentworth, Chief Customer and Strategy Officer at Wesleyan, said: "Working into our 70s will be the reality for many people, whether that's due to financial reasons, personal desires, or a mixture of both as our research indicates.

"Whatever age you are and however many working years you have ahead, planning for retirement gives you options for what's likely to be an unpredictable future for us all.

"Working past retirement age might end up being a lifestyle choice - but if you want to avoid it being a financial necessity, then it's important that you seek financial advice early to plan ahead effectively.

"Ultimately, unless money is being saved for when you eventually leave the workplace you could find you don't have enough in your pension pot to support the retirement you've worked towards."

Wesleyan is a mutual financial services specialist for doctors, dentists, lawyers and teachers.

[i] WEF report

[ii]The research was conducted by Censuswide in January 2017 and questioned 2,624 respondents

[iii]Baby boomers are defined as those aged 55+ in this research from Wesleyan

[iv]Periodic review of rules about State Pension age Report by the Government Actuary

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