PRIME Initiative

Pension giant Standard Life has produced a very interesting report called The Death of Retirement. The key findings are that the current generation of older people are very different to their parents. Above all they want to keep doing things. Baby boomers want to travel, work - and even launch new business ventures. Retirement in its traditional sense is not a concept that appeals to them at all.

“Currently society constrains people into a post-65 mindset which is at odds with their ambitions”, says Honey Langcaster-James, psychologist and one of the report’s authors. “Government, society, industry – particularly the financial services industry, use entirely the wrong language.

“The messages currently conveyed to the next generation approaching third age imply slowing down, being less involved in society, being cautious, risk averse and preparing to be less active.

“Ageism is endemic and could have severe implications for the mental health of third agers because it will ultimately frustrate their ambitions.”

“A huge potential resource is left untapped by not engaging this population, drawing on their expertise, their drive to embark on new ventures and pursue society-enhancing activities such as voluntary work and enterprise.”

Honey Langcaster-James, psychologist

Large survey

The report is based on a large survey of 1,500 people aged 46 to 65 of broadly representative wealth living in the UK. It was then repeated among another sample of 1,000 people from the same age group but representing the wealthiest six per cent of society. So two contrasting groups of normal and great wealth were polled.

Setting the scene, the report says that people from this baby boom generation face a future in which they are likely to be more financially burdened than ever before. They may have to provide for parents who will live a long time and for children who may be financially dependent well into adulthood. This financial burden goes alongside having greater ambitions than any previous generation for their own future after the age of 65.

When asked about their intentions regarding working in the “long-term future”, 30 per cent of the sample representing the normal UK wealth range said they wanted to continue to be involved in work - but on their own terms. This rises to 42 per cent for the wealthier group, who were also asked what their own parents did. Only 15 per cent of parents continued to stay involved in work after retirement. This indicates a massive change between the generations.

When asked about starting a new business, six per cent of the sample of 46-to-65 year-olds of normal wealth want to embark on a new business venture in the future. There was only a slight increase to seven per cent among the wealthier group, so wealth does not seem to be a major factor affecting this aspiration. But the passage of time has certainly produced a change. Among their parents’ generation this aspiration was much less common - seven times less at retirement age.

“It is not that those approaching retirement want to stop working. As our research reveals, baby boomers want to remain active. The challenge for government, society and the financial services industry is how to enable them to remain productive to answer the dilemma of our ageing workforce.”

John Lawson, Head of Pension Policy at Standard Life