As a new retirement survey finds that many people due to retire this year are prepared to work past the State Pension Age (SPA), Which? asks: are you ready to retire?
More than half consider working past the SPA
More than half (54%) of those surveyed by Prudential said they would consider working past the State Pension Age in an attempt to make their retirement more financially comfortable.
Around a quarter (23%) would consider working full-time while almost a third (31%) would weigh up the idea of working on part-time.
Once you reach state pension age, you are no longer obliged to pay National Insurance. If you carry on working for an employer, you should provide them with proof of your age (birth certificate, passport or certificate of age exception) and check National Insurance contributions are no longer deducted from your pay.
If you are self-employed you can also stop paying National Insurance. You may still have some Class 4 contributions to make in the first year you turn 65, though.
Go further: Which? has a specific guide to help you prepare if you are approaching retirement.
Consider your retirement options
The main motivation for 57% of this year’s retirees who would consider continuing to work past the traditional retirement age is to keep mentally and physically fit. However, more than a third (35%) also cite the ability to boost retirement savings as a consideration.
The average British wage is about £26,000 – to replicate that in retirement you’d need a pension pot of more than £300,000. However, it’s unlikely that you’ll need as much money in retirement as you did while you were working.
If you’re unsure whether your retirement income is set deliver the required lifestyle, or you want to understand the consequences of working on, you should consult a financial adviser.
Go further: Find out how much money you will get from your state pension.
Nearly a quarter aren’t ready to stop working
Prudential’s survey of 1,010 people due to retire in 2014 also looked at the future plans and aspirations of new retirees this year.
The research highlighted how attitudes to retirement are changing, with nearly one in four (23%) people planning to retire this year saying they don’t feel ready to stop working altogether.
Meanwhile 13% of those who had been scheduled to retire have chosen to delay their plans because they don’t want to give up work just yet.
Go further: Read our guide to get a better understanding about the implications of carrying on working in retirement.