Returning to employment after retiring due to increasing financial pressures
The rising cost of living due to inflation means that retired people must have enough savings to survive. This leaves many retirees in a precarious financial situation, as the value of their existing retirement funds is not keeping up with the rate of inflation. Even if they had saved diligently for their retirement years, the devaluation of their money can drastically reduce their purchasing power. This is leading many people to rethink their retirement plans.
We are witnessing a surge in the number of people giving retirement a second thought due to inflation rates and the cost of living crisis. Not only are more individuals looking to work beyond their State Pension age, but some are returning to employment after retiring due to increasing financial pressures.
Long-term effects
Over 2.5 million people aged 55 and over will be impacted by the long-term effects of financial insecurity and think they will continue to work past their State Pension age. Additionally, half of those aged 55 and over don’t believe their pension is enough to fund their retirement, a new survey has revealed[1].
Nearly four in ten over-55s who are not retired anticipate having to work past their State Pension age due to the increasing cost of living. Financial concerns surrounding retirement funding are the top drivers behind working beyond State Pension age.
Retirement savings
A quarter (23%) are uncertain of how long their retirement savings will last, and almost one-fifth (18%) admit to not having made any preparations for when they stop working.
Nearly half (46%) of the millions of older workers expecting to work past their State Pension age are apprehensive that doing so will mean they can’t enjoy their later years.
Major concern
Health, too, is another major concern, with nearly half (45%) worrying their health will deteriorate as a result of having to continue working and more than a third (35%) concerned it will affect their ability to remain employed.
Worryingly, 16% are concerned about being treated differently or worse at work because of their age and the same number worried about not being able to spend enough time with their family due to work commitments.
Older workforce
Looking ahead, the older workforce is expected to be crucial to the UK’s economic recovery as it will help ease severe labour shortages, yet this warning sign points to heavy financial strain many are facing.
But no matter what route you take, it’s essential to plan ahead and be prepared for the economic realities of retirement. Taking proactive steps now will ensure that your retirement years are as comfortable and secure as possible. With careful planning and financial security measures in place, your retirement years can be worry-free regardless of inflation levels.
Source data:
[1] Survey conducted by Opinium among 2,000 UK adults between 21–25 October 2022.
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