More than a million over-65s are continuing to work

12th June 2013

The UK now has one million workers over the age of 65 as the Belfast Telegraph reports. At Mindful Money, we would love to think this represents a huge and positive change in attitudes from employers and a massive opportunity for older workers to stay active and continue to contribute.

The news is part of the latest Office for National Statistics release which shows unemployment in general at 7.8 per cent measured from February to April and unchanged on the previous period.

Intriguingly despite the news, some experts maintain that the average date of retirement is too low. Here is David Sinclair, Assistant Director, Policy and Communications at the International Longevity Centre UK (ILC-UK), who says: “It is good news that we now have one million older workers. But the average age of retirement remains too low. In an ageing society, and with the state pension age increasing, it is important for individuals and the economy that we increase the number of years we spend in the workforce.

“Far too many people still leave the workforce too early, creating a huge drag on the economy. We must invest in improving the health of older people whilst also ensuring there is a supply of jobs to meet their needs. And we must ensure that discrimination does not act as a barrier to working longer. As our report last month highlighted, companies must do much more to innovate and adapt workplaces to meet the needs of an ageing society.”

That is certainly one point of view.

What concerns us a little however is that many people are continuing to work because they cannot afford to retire. They may have seen their pension underperform and then been shocked at the rise in the price of annuities when they came to convert it into an income. This is illustrated by research by insurer Partnership, reported by Mindful Money earlier this month, which showed you can expect a fall in income on retirement of as much as 40%.

They may have seen their employer cut back on their pension benefits, faced unemployment later in their working career, and, in some parts of the country at least, seen the value of their property fall limiting their ability to release equity from it.

There are few easy answers, though it is important to shop around when you convert your pension into a pension income. In addition, we think that anyone approaching retirement would do well to seek professional advice. That may help you identify exactly what your financial position is, and help you work out just how much you need to work yourself. And if you are one of the million, we hope you are doing so mostly out of choice not necessity.

 

 

15 thoughts on “More than a million over-65s are continuing to work”

  1. Anonymous says:

    The true state of the banks throughout the Peninsula has yet to emerge into the light of day. I recall reading that the Spanish allow six years for the gradual release of bad news about bad or doubtful debts on their banks’ balance sheets That must be up quite soon… though of course it could be (or could have been) renewed. It’s amazing how lacking in transparency the banks of the region have been, or perhaps more specifically, how the local central banks have colluded with them to deny the truth. Perhaps the Spanish (though not the Portuguese) are hoping for a radical revival of their moribund housing market. Dream on… it could be another decade.

    1. Anonymous says:

      here in Bulgaria, the housing market is on the way back to normal – helped by banking failures which encourage savers to buy property

  2. Pavlaki says:

    I am not surprised by this news but what does worry me is that the Troika are supposed to have given Portugal and the banks a thorough checking and yet did not come close to finding this. I wonder just how thorough these audits are and if we can have any faith in the planned audits by the ECB? It is all too easy to hide problems. Again I return to what I was told by a Spanish banking friend who reckons that Spanish banks are doing their best to hide problems due to non performing property loans and that what has been publically declared is much less than reality. The current Spanish government has been implicated as being corrupt, in the on going Barcenas case and I would not put it past them to exert pressure to bury bad news until at least after the next election.

    1. Anonymous says:

      Hi Pavlaki

      There are indeed a lot of questions posed by what has taken place here. The ECB is about to undertake its Asset Quality Review and stress tests and yet this debacle has taken place under its nose in Portugal where it has been for the past 3 years. Was it incompetence or did it turn a blind eye to what was happening?

      if we just stay within Portugal’s borders there must now be questions about the other banks there too.

      1. Pavlaki says:

        Turning a blind eye would be even more frightening and could end up with charges being brought against the ECB if it could be proved. Having said that I wouldn’t be surprised. I just don’t feel you can trust the regulatory authorities especially when they have already indicated that they lied during the Euro crisis to protect the grand project.

        1. Anonymous says:

          and explicitly broken the basic treaties covering the euro.

      2. Anonymous says:

        Banking is essentially about client confidence. Stretch everything as far as you can and hope that nothing important goes wrong. Multiply your clients’ deposited assets by at least a factor of ten, issue new money (in effect), play around with options and derivatives to your heart’s content (while taking nice juicy percentages all around that translate into enormous bonuses) and pray that nothing adverse happens. Well actually don’t bother to pray, because ‘too big to fail’ is the universal truth. Bankers can do whatever they like and nobody challenges them. My guess is that the ECB found so many warty toads under the stones they prised up that it by default became part of the systemic conspiracy. Any real challenge to the status quo would cause such a collapse that the show would simply stop – clients would lose all confidence. See various prominent German and French banks, for example. So now they are waiting for time to pass and the whole thing to move on. Except that it can’t. Underlying every economy there has to be real activity. Debt issuance is not real activity. The froth on the top that is banking has become totally disproportionate to the substance below. Sorting that out will be very painful, if anyone ever summons the courage to start! Don’t rely on any central bank to initiate the process.

  3. Fraser Bailey says:

    Whatever…just another pile of fraud, greed and incompetence from an entirely criminal banking industry. I call them The Bank of Secret Santa, or sometimes the Spirit of Santa, depending on my mood. And for what it’s worth, I call the Monte Paschi Bank in Italy the Monty Python Bank.

    1. Anonymous says:

      Hi Fraser Bailey and welcome to my corner of the blogosphere

      There has indeed been great criminality in the banking sector although sadly very few have been properly punished for it. But what the story of BES confirms is that for all the talk of new regulatory regimes and reforms rather basic problems still seem to elude them.

  4. dutch says:

    ‘Whilst there is no doubt that BES needed the extra capital those who
    invested back in June had plenty to think about even before last night’s
    announcement.’
    A fool and his money etc. It’s hard to beleieve people still fall for this one.

    1. Anonymous says:

      Hi Dutch

      I believe that one or two groups are getting together already to investigate whether they can sue over the rights issue. Prima facie they certainly look to have a case to me.

      As to any future investment there was this in the CEO’s statement last night.

      “Over the course of the past few weeks, both shareholders and potential investors have shown interest in participating in a capitalization plan, some of them willing to take relevant stakes in the Bank.”

      However I note that today no concrete details seem to have followed this. So the investors (if they existed..) are perhaps thinking again.

  5. Forbin says:

    Hello Shaun,

    you right – many questions

    but who in power or the media is asking any of them ?

    anyone?

    Its not just the Bankers who are corrupt – its the politicians as well

    We all know where Tony Blair ended up

    This cycle needs to be broken and soon , along with Glass-Steagall re-enacted . But as they say , follow the money …. so nothing will change!

    Forbin

    sits back with new popcorn and watches the show go on , once as tragedy and now as farce …..

    1. Anonymous says:

      Hi Forbin

      Yes the show goes on pretty much unchanged. This particular instance does shine the spotlight on Portugal which has been accused of cronyism and corruption pretty much along the lines of the way things have turned out at BES. But for all the promises of change we seem to find ourselves in the same old mess..

  6. Anonymous says:

    Hi Francis

    I take your point as there are certainly some similarities between the two. Although aren’t most drugs decriminalised in Portugal now? So the Co-op’s chairman might have been okay there….

    The difference though is the scale of the issue as for Portugal this is a much bigger problem relative to its economic output or national debt than the Co-op would be for the UK.

  7. Anonymous says:

    When I spent 3 years in Portugal a decade or so ago, you would not have known that any drug was prohibited by law. In fact, drug taking was rife at all levels of society. Sad, because Portugal is a nice place with nice people.

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