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Old Mutual Wealth research finds one in three planning to work part-time in retirement

09/02/2015

The number of people working part-time in retirement is set to increase dramatically, research from YouGov and pension and investment provider Old Mutual Wealth has found.

The research shows that 11% of those already in retirement choose to work part-time. Among those approaching retirement, nearly a third (30%) plan to use part-time work to supplement their income.

The data shows that among those planning to work part-time in retirement, 56% report that keeping busy is one of the key motives. Addressing a retirement income shortfall was cited as a key reason by 52%, while 48% said they valued the social interaction.

People in London and the South are most likely to want to work part-time in retirement. Among those surveyed in London, 63% reported they would continue working part-time and 40% of workers in the South indicated the same. The figure is 33% and 29% in the North of England and the Midlands respectively.

Working part-time in retirement has become easier since 2011 when the Government introduced reforms to prevent employers discriminating against older workers.

There are a number of financial advantages to working part-time in retirement. Employees over the state retirement age do not pay any National insurance contributions. Working part-time in retirement may allow the individual to defer their state pension and potentially leave some or all of their private savings invested. Deferring state pension offers an increase of 10.4% for every year of deferral, although this will decrease to 5.8% following the introduction of new state pension rules in 2016.

Old Mutual Wealth retirement planning expert Adrian Walker says:

“The meaning of the word retirement is changing. Whereas previous generations may have viewed retirement as a chance to switch-off at the end of a challenging career, more and more people are choosing to make a gradual transition into retirement.

“Working part-time in retirement gives people the freedom to enjoy a balanced lifestyle and support a richer and more vibrant retirement.

“Thanks to incoming pension reforms, which allow those age 55 and over to take income from pension savings as they wish, people will now have the freedom to manage their retirement income needs far more flexibly. Working part-time and drawing a small amount from savings in the early years of retirement will be an appealing option for many. They will then have the choice to increase the amount taken from their savings when they choose to stop working altogether.

“However, the option to continue working part-time in later life is no substitute for a long-term retirement savings plan. Those planning ahead can take advantage of tax relief and investment growth in pension savings now in order to ensure they enjoy a prosperous retirement.”

*The survey, conducted by YouGov as part of Old Mutual Wealth’s Retirement Income Uncovered report, polled 1536 UK adults aged 50-75.

For more information contact

Michael GlenisterOld Mutual Wealth020 7778 963807469 144535michael.glenister@omwealth.com

Notes to Editors:

Old Mutual Wealth is a leading wealth management business in the UK and internationally, helping to create prosperity for the generations of today and tomorrow.

Old Mutual Wealth oversees £131.3 billion in customer investments (as at 30 September 2017).

It has an adviser and customer offering spanning: Financial advice; investment platforms; multi-asset and single strategy investment solutions; and discretionary fund management.

The business is comprised of two segments: Wealth Platforms and Advice and Wealth Management.

Wealth Platforms includes the Old Mutual Wealth UK Platform; Old Mutual International, including AAM Advisory in Singapore; and the Old Mutual Wealth Heritage life assurance business.

Advice and Wealth Management encompasses the financial planning network, Intrinsic; Old Mutual Wealth Private Client Advisers; discretionary fund management business, Quilter Cheviot; and Old Mutual Wealth’s multi-asset investment solutions business.

Old Mutual Global Investors (‘OMGI’) is the asset management business of Old Mutual Wealth with £39.8bn funds under management (as at 30 September 2017). On the 19th December 2017, Old Mutual Wealth announced that it has agreed to sell its Single Strategy asset management business to the Single Strategy Management team and funds managed by TA Associates. The proposed transaction is subject to customary closing conditions, including regulatory approvals. 

Following managed separation from Old Mutual plc, Old Mutual Wealth will rebrand to Quilter plc. Each of the businesses within the Quilter Plc group will be rebranded over a two-year period, with the exception of Quilter Cheviot, which will retain its existing name.

Old Mutual Wealth is part of Old Mutual plc, a FTSE 100 group that provides life assurance, asset management, banking and general insurance. Old Mutual is trusted by more than 19.4 million (as at 31 December 2016) customers across the world and has a total of £212.3 billion of assets under management (as at 30 June 2017).

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