Reinventing retirement – or being pushed off a cliff?
By Tony Watts - Editor - 08/04/2008
This month marks the start of a two-year countdown to state pension age changes for women, which sees the state pension age for women start to gradually rise from 60 to 65 from 6th April 2010. But how do people feel when they reach that point?
New research by Ipsos MORI shows a mixed bag of emotions for those waking up on day one of retirement with under a third saying they felt relaxed and under a quarter feeling free.
A surprising one in ten felt anxious, sad or lost.
Pensions Minister Mike O’Brien (pictured) comments: “The idea that one day you work and the next you stop can be a shock to the system. These findings challenge the traditional ‘one size fits all’ approach to retirement. Many of today’s older workers are rejecting the cliff edge between work and retirement in favour of a gradual step down. And employers should help them to do this.”
Over 1000 people over 55 were interviewed to find out their views on retirement and work. People approaching retirement admitted there’s lots they’ll miss about their jobs when they stop. Topping their miss list are work friends, being challenged, office banter and a reason to get out of the house.
When asked why they still work, extra cash was a top motivator followed closely by over half doing it because they enjoy their jobs. A third cited keeping the mind active or keeping fit and over a quarter said they’d miss work if they stopped. Interestingly, the number of people who felt too young to stop increased with age from just under a third of 55-64 year olds to nearly half of those 65-74 year olds surveyed.
The DWP maintains that the stepping down approach is reaping dividends with part-time workers enjoying greater job satisfaction than their full-time counterparts. Over one million Brits are already working past state pension age and most of these have chosen to work part-time. With people living longer, healthier lives this trend looks set to continue.
Mike O’Brien adds: “Women’s state pension age is moving but you don’t have to retire at this date. You have time to plan and you may be surprised by the choices you have. You could use your state pension to allow you to work part time or choose to put off taking it and get extra pension later or a lump sum.
However, the The Age and Employment Network takes a very different view o the subject. According to Chris Ball, Chief Executive of TAEN: “Government policy is pushing people off the retirement cliff edge.
“We know from first hand experience that more and more people want to extend their working lives and turn retirement from an event into a process – perhaps lasting between five and ten years.
“Some forward-thinking employers are giving their employees the opportunity to gradually wind down by offering flexible working options of one kind or another. The DWP, to its credit, is among them.
“However, the Government’s own policy of introducing a default retirement age of 65 means they are responsible for many older workers being pushed over the retirement cliff edge by their employers.
“So, if the government is serious about providing a gradual ‘step-down’ for those who don’t want, or can’t afford, to stop working just yet, it should scrap the default retirement age without further delay rather than waiting for the 2011 review.
“Since April 2006 people have been allowed to semi-retire by working part-time while drawing a pension from the same employer. The pity is that a miniscule number of employers have so far introduced this facility.
“TAEN is convinced that ending the ‘cliff edge’ approach is long overdue. However, the practical barriers need removing for the flexible approach to gather momentum.”
To get the facts, put your birthday into the Pension Service website and it’ll tell you when you can get your state pension.”