Workers retiring later as life expectancy increases

The Momentum UK Team 17 February 2012

Life expectancy is rising, but so too is retirement age says a report from the Office for National Statistics.

According to the latest "Pension trends" data from the ONS we're living longer and healthier lives, with an increasing number of people staying in the workforce for longer.

The ONS report said the increasing number of individuals remaining in work was a combination of those who "choose to work in later life" and those who "continue working because they have not saved enough for their retirement".

The average age at which individuals are leaving the labour market climbed from 63.8 to 64.6 years old for men and from 61.2 to 62.3 years old for women between 2004 and 2010 the figures show.

Men retiring at 65 in 1981, could expect to live for 13 years, 9.9 of which they could expect to remain healthy for. By 2008 the figure had increased to 17.6 for life expectancy, 12.8 of which men could expect to remain in good health on average. A similar though smaller rise was seen for women.

The data also suggests that the financial burden of supporting an ageing population will continue to increase. The planned changes to state pension age should ease the pressure, but the burden is still likely to be greater than ever before.

The report said that if the government were to keep state pension age at its current level by 2051 there would be a 2:1 ratio of people of working people to those over state pension age.

For information on saving for retirement visit our pensions section.