There is no fixed retirement age in the UK. In other words, an employer can no longer force any employee to retire when they get to a certain age, which used to be the case. The default retirement age UK of 65 years no longer exists, so you can work as long as you like and make your own decision as to when you retire. However, if you work in certain industries, such as the Fire Service, or there are physical fitness levels associated with your work, then you will be subject to a ‘compulsory retirement age’.
What is the retirement age in the UK to claim the state pension?
There are ages at which you can access state, workplace and personal pensions. Different minimum retirement ages apply when it comes to being able to access these respective pension funds.
There have been calls for the government to up the men and women’s pension age UK to 70 by 2046 in order to control the cost of rising state pension costs.
The current state pension age in the UK for both men and women is 66. There is now no difference between women’s pension age UK and male retirement age UK for claiming the state pension as there used to be.
The system has been subject to modification over the past few years, and when you can claim your state pension will depend on when you were born.
For men and women born after 6 April 1978, the state pension age is now 68 years. However, for those born before 6 April 1970 it’s 67 years. For those born between 6 April 1970 and 5 April 1978, it varies between 67 and one month, and 68, depending on when their birthday falls.
What is the average retirement age UK?
As of 2021, the male retirement age UK average was 65.1 years, whilst the women’s average retirement age UK was 64. There was a decrease of around 0.3% in the average age to retire for both genders as of 2021.
The average retirement age UK wide has been increasing since the mid-20th century.
Nowadays, most people retire when they’re around 65 years old, although there is a big trend towards working page. In fact, it may surprise you to learn that the number of people working into their 70s in the UK has doubled in the past decade. This is due to a number of factors.
Firstly, life expectancy is on the rise. In 1960, the average life expectancy was 71. It’s now 81. A lot of people have a desire to keep working so they can fund their lifestyle into older age.
Secondly, due to the increase in technology-driven jobs, fewer people are doing physically demanding manual jobs. This means that it’s more likely for workers to stay employed for longer.
Finally, we’re ageing better than former generations. Less people are leaving employment on health grounds.
So what is the best age to retire in the UK?
The answer to this question lies in how much you need to comfortably retire and fund the lifestyle you desire.
The Retirement Living Standards describes a ‘comfortable retirement’ as, ‘more financial freedom and some luxuries’, with couples needing around £47,500 per year to enjoy life at that level. For single retirees, the annual income for a comfortable retirement needs to be around £30,000. These figures increase for those living in London to £49,000 and £36,000 respectively. Luxuries may include three weeks’ holiday in Europe each year, regular beauty treatments and leisure trips.
Some people look forward to an early retirement, in which case you would need to look at how much you’d need to retire at 55, for example. This is currently the earliest age at which you can start drawing a personal pension, although there may be certain circumstances in which it is possible to draw it earlier, such as ill health.
If you own a business, you may pass the responsibility of running on to someone else, then start drawing your personal pension and topping up your retirement income through any investments you may have. Alternatively, you may decide to sell the business to help fund your retirement.
If you are employed, you would hand in your notice and access your workplace pension, topping it up with any private savings or investments you may have.
The best age to retire UK wide really depends on how well you have planned for it financially, and whether you feel ready to retire.
Looking for retirement planning advice? Talk to the specialist retirement planners at PMW.
At Partridge Muir & Warren, we have been advising individuals and couples on their retirement planning options for over 50 years. Our advice is independent, widely trusted and fully focused on the best interests and personal goals of our clients.
Through our in-house team of legal, financial and tax experts, we are also able to provide advice on wills and estate planning so that our clients have access to a complete range of helpful, associated guidance.
If you would like to start looking at how you could retire when you feel it’s best for you, get in touch with our friendly team to arrange your no-obligation complimentary consultation.