One in 10 staff would delay retiring if boss allow them to work at home

One in 10 workers would be prepared to slow down or delay retirement due to improved opportunities to work from home or choose their own hours, research reveals.

Flexible working has become much more widespread since the pandemic. However, also due to Covid there is now a shortfall in the workforce as many older people gave up work for good.

Among those rethinking retirement, 60 per cent said the change in working practices allowed them to transition to retirement more slowly, for example by going part-time.

And some 23 per cent have put plans to stop work on hold altogether, according to the research by adviser network Wesleyan Financial Services.

Flexible rules: Working from home has become much more widespread since the pandemic

During the pandemic, some older workers seized the opportunity to retire early while others were forced to give up for reasons such as redundancy, their own ill health or caring duties.

Wealthy people are the most likely to retire early and poorer workers to give up for health reasons, while those in the middle slog on well into their 60s, according to previous research by think tank the Institute for Fiscal Studies.

The previous Tory Government attempted to encourage professional 50-somethings to remain or return to the workforce with measures including improved pension tax breaks.

The new Labour Government is also expected to try to tackle the current gap in the workforce left by older workers as part of its bid to boost economic growth.

The research by Wesleyan Financial Services found that 26 per cent of over-55s either have already or are planning to ‘unretire’ by taking on paid work again.

Among this group, 22 per cent are doing it for the money, 19 per cent to keep their brain active, and 13 per cent to give themselves a better sense of purpose.

Wesleyan, which surveyed 2,000 people aged 55-plus, also found 28 per cent of them hadn’t checked if reducing hours or going part-time would affect their pension.

Managing director Linda Wallace said: ‘Any change to retirement plans, whether it’s easing into retirement more slowly or bringing forward a retirement date, can have financial and personal implications.

‘Delaying retirement, for example, can give you more time to build retirement savings and investments, but it can also mean having to postpone personal ambitions or projects.

‘On the other hand, accelerating retirement may mean you need to stretch your savings for longer – but it can also mean you’re free to pursue other pursuits, including different kinds of work or spending more priceless time with family or loved ones.’

How to sort out your pension if you fear it’s falling short

1) If you are worried about whether you will have saved enough, investigate your existing pensions. Broadly speaking, you need to ask schemes the following questions.

– The current fund value.

– The current transfer value – because there might be a penalty to move.

– Whether the pension is in a final salary or defined contribution scheme. Defined contribution pensions take contributions from both employer and employee and invest them to provide a pot of money at retirement. 

Unless you work in the public sector, they have now mostly replaced more generous gold-plated defined benefit – career average or final salary – pensions, which provide a guaranteed income after retirement until you die. 

Defined contribution pensions are stingier and savers bear the investment risk, rather than employers. 

– If there are any guarantees – for instance, a guaranteed annuity rate – and if you would lose them if you moved the fund.

– The pension projection at retirement age. You can use a pension calculator to see if you will have enough – these are widely available online.

2) You should add the forecast figures to what you anticipate getting in state pension, which is currently £221.20 a week or around £11,500 a year if you qualify for the full new rate. Get a state pension forecast here.

3) If you are tempted to merge your old pensions, read our guide first to ensure you won’t be penalised.

4) If you have lost track of old pots, the Government’s free pension tracing service is here. Our retirement columnist, Steve Webb, has a guide to finding lost pensions here.

Take care if you do an online search for the Pension Tracing Service as many companies using similar names will pop up in the results.

These will also offer to look for your pension, but try to charge or flog you other services, and could be fraudulent.