Winning the rat race: The majority of the class of 2017 are retiring early
02 June 2017
- It’s an early retirement for six in 10 planning to give up work this year
- But they will be £1,250 a year worse off than those who work until their retirement date
- Those retiring early are more confident that their pension and savings will provide sufficient retirement income
- Wales and London are the UK’s early retirement capitals
Younger generations may be bracing themselves to work well into their 70s – but the early retirement dream lives on for many people retiring this year. New research from Prudential1 has found six in 10 (60 per cent) of those giving up work this year – the Class of 2017 – are doing so earlier than their projected State Pension age, or company pension scheme retirement date.
The insurer’s unique annual study – which for the past ten years has tracked the finances, future plans and aspirations of people planning to retire in the year ahead – shows that those members of the Class of 2017 who are planning to retire early this year are even willing to take a hit on their expected retirement income, to the tune of £1,250 a year, in exchange for giving up the daily grind. Those who are planning to work until their retirement date expect to retire on an income worth £18,900 each year, compared to the £17,650 expected by people retiring early.
However, this year’s retirees who are planning to quit the rat race early feel better-prepared when it comes to their retirement than those who are not stopping early, with 60 per cent of those taking early retirement saying they are financially well-prepared, compared with 46 per cent of those working towards their retirement date.
The early retirees are also more relaxed and confident about retirement than those who plan to work for longer, with more than half (56 per cent) expecting to have enough income for a comfortable retirement compared with just two out of five (38 per cent) of those who are not retiring early.
This confidence can be explained, in part, by their focus on pension saving. Those who are retiring early, are more likely to have saved into a pension scheme – 86 per cent compared with 71 per cent who are not stopping work early. Just 10 per cent of early retirees have no pension savings, compared to 21 per cent of those who aren’t planning to retire early.
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