Brits urged to take one 12 months break from work to get £42,000 enhance
New analysis from Standard Life has found that taking several short career breaks during working life could boost retirement savings by tens of thousands of pounds
As Brits feel the squeeze from the Cost of Living crunch, Standard Life’s boffins have crunched the numbers and their report is an eye-opener. The insight: take a ‘micro-retirement’ and you might just boost your golden years fund, especially if you’re willing to extend your career on the other side.
The money gurus at Standard Life are spot on with their stats – if you start stashing away cash aged 22 on £25k a year, sticking to those auto-enrolment payments, you’re looking at a tidy £163,000 by the time you hit 62. Inflation-adjusted, mind you!
But wait – it gets better. If you down tools for a year-long breather at 30, then clock back in until 68, that retirement war chest could balloon to 205k – that’s an extra £42k, reports Birmingham Live.
Yep, taking the long view might mean a smaller pile at 62, missing around £4k, but stick it out and you’ll be laughing all the way to the bank come 68.
Standard Life’s retirement expert Mike Ambery said: “Taking a ‘micro-retirement’ might mean a temporary pause in pension contributions, however the trend offers a unique opportunity for your ‘proper retirement’ savings as well as shorter-term personal wellbeing.
“As you tend to be at your peak earning potential later in your career, saving for a few extra years just before retirement could have a disproportionately positive impact. Ultimately, the micro-retirement trend reflects a broader shift towards greater flexibility and work-life balance, and an acknowledgement that in future our lives are likely to be more fluid than the traditional education, then earning, then retirement structure.”
“With the right support and planning, it could lead to a more sustainable working life, while still enabling financial security in retirement.”
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