More than one in five (21%) of pensioners have gone back to work since they reached the State Pension age, or are planning to do so in the future, according to new research from Prudential. The rise of the retired jobseeker, along with the growing trend for a period of pre-tirement as previously identified by Prudential, shows how the modern retirement reality continues to shift further from the traditional norm of giving up work for good on a set date.
The Prudential findings suggest that heading back into the jobs market is driven by a desire to keep mentally active (61%), although the need to boost retirement income (56%) is also driving retirees back to work. Voluntary work is the choice of around one in six (16%) retirees who are back at work or plan to return in the future – underlining the point that it is not always financial reasons that drive pensioners to seek employment.
Even those who are earning are likely to take a pay cut – more than half (51%) say their post retirement wages will be lower than their previous income in employment. Meanwhile, nearly one in 20 working past State Pension age are earning more than they did before, while one in 12 are setting up their own companies. Prudential has also analysed ONS data and found that the most likely sectors for those working past State Pension age to find employment in are teaching and education, secretarial jobs and agricultural jobs.
According to the research from Prudential, women who have passed the State Pension age are more likely to have ruled out a return to work, with 51% saying they’re definitely retired compared with 44% of men. Stan Russell, retirement income expert at Prudential, said:
“Although it’s striking to see how many retirees are choosing to return to work, it’s not optional for some people. While many say that working in older age is a good way of staying active, there are others who are forced to go back to work to make ends meet.
“Of course, there are real financial benefits from going back to work, such as earning extra cash and deferring taking the State Pension or income from private savings. However, for people who are hoping to give up work completely when they retire, saving as much as possible as early as possible in their working life remains the best way to secure the most comfortable retirement. The changes to pension rules that came into effect back in April have further increased the choices that the over-55s have to consider when preparing for retirement. Now more than ever, it is hard to overestimate the benefit of professional financial advice for most people planning for their retirement.”