The age of the ‘grandad-olescent'

AEGON research reveals a significant shift in the way 50 to 65 year-olds are viewing retirement, showing how role models such as Harrison Ford and Madonna are turning the ‘baby boomers' into a generation of ‘grandad-olescents'.

Less than one in three (29%) says they intend to stop working when they reach retirement age despite the vast majority believing they would at least "get by" financially if they were to do so. But are these expectations grounded in reality and what financial needs will this generation have in retirement?

AEGON surveyed over 2,000 people between the ages of 50 and 65 to gauge their attitudes towards retirement and to see what sort of financial provision they have in place. The study shows retirement in the ‘noughties' is becoming a second adolescence, and is more likely to include flexible working or a new career, than a carriage clock and a pair of slippers.

The survey reveals that 61% expect to carry on working in some capacity after they reach retirement age or pursue further education or charity work - and, for most, not because they have to. More than one in ten (11%) said ‘love of the job' made them want to stay in the work force while 14% argued that they were simply ‘too young' to retire. 12% said they would like to try out a completely different career in their retirement.

Thanks to exceptional social and economic factors, ‘baby boomers' should be in a better position financially to enjoy retirement than any previous generation. In fact, 42% think they will be better off than their parents in retirement.

However the report highlights a significant knowledge gap when it comes to planning, as 42% of respondents have no clear idea about how much income they will have in retirement. 44% expected to receive an income less than £15,000 a year and only 14% thought their pension savings would produce more than £15,000 a year.

Interestingly, 33% are relying on their pension alone, with no other savings or investments. While these figures wouldn't seem to indicate a comfortable retirement, 86% say they would at least "get by" financially if they were to stop working at retirement age with only 14% saying they would struggle to cope financially. This may be because 47% of respondents don't expect to have a mortgage or other outstanding debts at retirement.

Perhaps understandably in these times of rising prices and falling stockmarkets, securing a guaranteed income during retirement is at the top of the wish list, with 87% of respondents saying this is most important to them. Running out of money is a concern for one in five people (22%) questioned.

Rachel Vahey, head of pensions development, says: "Retirement isn't the abrupt cliff edge it once was and, for many of today's ‘baby boomers', retirement age marks a new and exciting chapter of their lives. But if you want to make adventurous life choices and have a more flexible approach to retirement you have to know what income you're on track to receive and plan carefully.

"Today's retirees have to deal with the fact that people are living longer and stockmarkets are more volatile. Running out of money is a big fear factor and many people want the security of a guaranteed income. The good news is there are more products and solutions available now to complement people's changing lifestyles. So making the right choices is more important than ever."

For more information, visit aegon.co.uk