One expert said that ‘people face a growing gap between their retirement hopes and expectations’
The average Brit now believes they won’t be able to give up work until 67(Image: Getty)
The aspiration of an early retirement is becoming increasingly elusive for millions, with the typical worker now anticipating they’ll need to continue working for five years beyond their preferred timeline. Major research by Standard Life revealed that whilst the desired retirement age remains at 62, the average Briton now expects they won’t be able to stop working until 67 – rising from 66 the previous year.
This divide between aspiration and reality – termed the Retirement Expectation Gap – has expanded for a consecutive second year, driven by the cost of living crisis, pension uncertainty, and mounting economic pressures.
Catherine Foot, Director of the Standard Life Centre for the Future of Retirement said: “People face a growing gap between their retirement hopes and expectations.
“Average rates of saving are too low to give most people a decent income in retirement. The system must evolve if longer working lives are to be realistic and sustainable.” For our free daily briefing on the biggest issues facing the nation, sign up to the Wales Matters newsletter here.
The study discovered that half of Britons remain uncertain whether the State Pension will still exist when they reach retirement age, whilst only 29% have confidence the Triple Lock will remain operational, reports the Express.
Merely three in ten adults report they are living comfortably, whilst nearly half (47%) believe their retirement finances are “outside their control.”
Employees in the North East confront the most challenging prospects, facing nearly six years between their hoped-for retirement and when they believe it will be achievable – 61 versus 67.
In contrast, Londoners experience the narrowest gap – 63 versus 66. The report discovered that escalating costs and pension uncertainty are undermining confidence.
Just 15% of adults indicated that pension saving was amongst their top financial priorities this year.
Amongst those on lower incomes, the situation is more dire – individuals earning under £30,000 who haven’t prepared for retirement face a shocking eight-year chasm between expectation and reality.
However, Standard Life maintains that even a modest increase in pension contributions could yield a significant difference. An individual on a £25,000 salary who increases contributions by merely 2% from age 22 could accumulate an additional £51,000 by 67.
Ms Foot emphasised that “careers and workplaces must evolve” to enable people to work flexibly into later life.
“Many feel unable to continue working into their late 60s,” she said. “That means supporting carers, retraining older workers, and allowing people to step back and re-enter work as needed.”
The report cautions that without immediate action, the UK confronts a widening chasm between those who can afford to retire on their own terms – and those who will have no option but to continue working long after they wish to stop.