Nearly two-thirds of workers retire before reaching State Pension Age

• Almost two-thirds (62%) of retirees left the workforce earlier than State Pension Age

• Over a 3rd (34%) of these dipped into their pension earlier than retiring including to considerations over the sustainability of pension pots

Analysis from retirement specialist Simply Group’s Countdown to Retirement survey1 reveals that roughly two-thirds of over 55s retired earlier than reaching the State Pension Age, which at the moment stands at 66.

Greater than six in 10 (62%) of the 1,050 retired over 55s surveyed left the workforce earlier than receiving their State Pension. A fifth (19%) acknowledged that they retired as quickly as they began to obtain the State Pension, and the identical proportion (19%) claimed they retired someday after receiving the State Pension.

Male retirees (69%) had been extra seemingly than their feminine counterparts (55%) to retire earlier than the State Pension.

Over a 3rd (34%) of those that retired earlier than they reached State Pension Age mentioned that additionally they withdrew cash from their pension between the age of 55 and ending full-time work, highlighting widespread use of pension money by many individuals but to surrender work.

In the meantime, knowledge from the FCA’s Retirement Earnings market update2 raised considerations in regards to the sustainability of revenue withdrawals. It discovered that 40% of revenue drawdown plans had been being withdrawn at an annual price of 8% or over, with 13% seeing common withdrawals of 6-7.99%.

Commenting on the analysis, Stephen Lowe, group communications director at retirement specialist Simply Group, mentioned: Nearly all of persons are retiring earlier than they attain State Pension Age, placing additional strain on their retirement funds as a result of they need to bridge the revenue hole between stopping work and beginning to obtain the State Pension.

“Unsurprisingly, our survey additionally found excessive ranges of early pension entry with almost three in 10 (28%) taking cash out of their pension earlier than retiring, rising to greater than a 3rd of those that stopped working earlier than State Pension Age.

“Nearly all of folks utilizing revenue drawdown methods are extracting greater than 6% a yr, considerably greater than benchmark so-called ‘protected’ charges of nearer to 3-4% exacerbating considerations about how lengthy folks’s pension revenue will final.

“We might urge folks approaching the age once they can entry their pension, and people fascinated by once they can afford to go away the workforce to hunt assist earlier than making irreversible choices.

“Searching for help from knowledgeable monetary adviser stays the gold commonplace, nonetheless, making an appointment with free, impartial and neutral authorities steering service Pension Sensible can provide folks a very good understanding of their choices.”