Prudential has revealed that more than a third of people are delaying their retirement and putting their dreams on hold.
More than a third (38 per cent) of people due to retire in 2011 are cancelling their plans and delaying retirement and working longer, and a significant proportion (22 per cent) of these are doing so because they can't afford to stop working.
The findings, from Prudential's Class of 2011 study, revealed that those delaying retirement this year for financial reasons, had, on average, hoped to stop working at age 62 but now expect to be 68 years old before they can finally take up their state pension. The study, now in its fifth year, questioned people who had planned to retire during 2011.
Two fifths (40 per cent) of those delaying retirement in 2011 due to the financial strain that it will create, believe that they will have to keep working until they are 70 years old, or older, in order to retire with a comfortable income.
Prudential's study shows that of all those planning to retire in 2011, 22 per cent now say they can't afford to – a figure that has increased since 2010 when it was 15 per cent. In addition, 16 per cent of those planning to retire in 2011 do not want to quit working.
Vince Smith-Hughes, head of business development at Prudential said: "The only realistic option for those who want to avoid having to delay their planned retirement is to start saving as much as they can as early as they can.
"However, as inflation reaches 5.5 per cent and disposable incomes are reduced, Prudential's research shows that people are postponing retirement to either build up their pension pots further or simply to continue in a job that they enjoy. When economic factors are combined with changes in legislation, such as the abolition of the Default Retirement age and an increasing trend of choosing to continue at work, it is easy to understand why more people are postponing their retirement plans.
"Seeking professional financial advice is a prerequisite to securing the retirement income that people need and we recommend that those who are approaching their planned retirement age should speak to a financial adviser on at least an annual basis."
Scotland has the lowest percentage (31 per cent) of people who have delayed their retirement plans in 2011, whereas the South West has the greatest proportion of people (44 per cent) now looking to put-off their scheduled retirement until a later date.
"Prudential" is a trading name of The Prudential Assurance Company Limited, which is registered in England and Wales. This name is also used by other companies within the Prudential Group, which between them provide a range of financial products including annuities, life assurance, bond investment, a tax calculator and retirement plans, which include pension schemes, a pension calculator and pension advice.
Notes to Editors:
Survey conducted by Research Plus using an online methodology between 5 and 14 December 2010 among 10,143 UK non-retired adults aged 45+ including 1,005 retiring in 2011.
In the year to February, RPI annual inflation was 5.5 per cent, up from 5.1 per cent in January - www.statistics.gov.uk/cci/nugget.asp?id=19.
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