Lack of financial planning forces Brits back to work

Brits are being forced to delay their retirement, or return to work due to their failure to plan for their retirement, according to research from Zurich.

The survey reveals that 64% of Britons of retirement age are considering carrying on working after retirement, with nearly a third (31%) of people expecting to return to work for financial reasons.

This emerging trend, identified by independent think tank the Future Laboratory as ‘Returnment', reflects the changing nature of retirement in the UK.

Speaking on the subject of returnment at Zurich's recent credit crunch conference, The Right Honourable Michael Portillo commented, "The combined impact of the rising cost of living, rising inflation, fears of recession and the constant media coverage of the credit crisis, has created insecurity for a huge number of people approaching retirement concerned about their financial future. Given that so many people are aware that they will face financial difficulties in retirement, more and more people are staying on at work, or returning to work to help ease the financial pressures they face ahead."

The research also reveals that those facing retirement expect to return to work for other reasons as well as financial pressures. Over a third (34%) of people want to stay active through their retirement and therefore are considering continuing to work.

About a quarter (26%) of people plan to keep working because they are worried about being bored in retirement. Just over two in ten (22%) believe they still have a contribution to make and would therefore consider continuing to work; and one in ten people say they will miss the buzz of working life. Only 36% of people will not consider going back to work at all.

Worryingly, it seems that Britons are failing to seek financial advice to help ensure a comfortable retirement. Zurich's research shows that 74% of Britons have never sought advice on planning for their retirement.

It seems the younger generation are least likely to seek advice, with 94% of those aged 25-34 choosing not to seek advice, whilst for those approaching retirement, surprisingly, almost seven out of ten people (69%) of those aged 55 and over have never sought advice.

The research also reveals that Britons have potentially unrealistic expectations of the lifestyle they can expect in retirement. Whilst 42% of people recognise that they are not saving enough now to afford their ideal lifestyle in retirement, people still intend to enjoy a rich and varied retirement with four out of ten people planning to pursue even more activities in retirement.

65% of Britons are expecting to go on holiday every year in retirement and more than half (52%) believe that they will be able to get away at least twice a year. And an incredible 16% of Britons plan to travel extensively in retirement and take a holiday every three months.

As well as travelling, nearly a third of Britons (31%) intend to socialise a few times a week whilst three out of ten (30%) plan to go to cultural events, such as the theatre and the ballet, at least once a month.

Tony Solomon, Business Development Director, Zurich UK Life, commented: "Whilst it is encouraging to see that people intend to lead such an active retirement, there is real need to alert people to the importance of planning for their retirement from an early age. If we fail to address this issue, there is a real danger that for those already enjoying their retirement, may be last generation to experience the financial freedom of a carefree retirement spent living off the children's inheritance."