Thinking about continuing to work after reaching your State Pension age? You're certainly not alone. Many people in the UK are choosing to extend their working lives beyond traditional retirement, whether for financial necessity, personal fulfillment, or simply because they love what they do.
The good news is that you have more flexibility than ever. The 'default retirement age' of 65 no longer exists, giving you freedom to make decisions that suit your circumstances.
Understanding your State Pension age
Your State Pension age – the earliest you can start to draw your pension – depends on when you were born. Currently, the State Pension age is 66, but this is scheduled to increase to 67 between 2026 and 2028. You can check your State Pension age using the official government calculator.
The financial benefits of working longer
Working beyond State Pension age can significantly boost your financial security. The full new State Pension currently provides £230.25 per week (£11,973 annually), which may not be sufficient for your desired lifestyle. If so, working longer can bridge this gap and provide the additional income you need.
A major advantage of working longer is that you won't pay National Insurance contributions on earnings after State Pension age, effectively giving you a pay rise. However, you may still need to pay income tax depending on your total income.
If you defer taking your State Pension, you'll receive an increase of approximately 1% for every nine weeks you delay. This means delaying for a full year would boost your weekly payments by around 5.8% for life.
Your rights and protections
Your employment rights remain strong when working beyond State Pension age. Employers cannot force you to retire simply because you've reached a certain age, unless they can justify a compulsory retirement age for specific reasons.
You're protected from age discrimination when applying for new positions. You don't have to disclose your age when job hunting, and employers cannot set arbitrary age limits unless legally justified.
You can also request flexible working arrangements at any age, though employers may decline such requests.
Maximising your financial future
If you have workplace or personal pensions, continuing to work allows these investments more time to grow. Check if you have gaps in your National Insurance record – you may be able to make voluntary contributions to boost your eventual State Pension.
Consider your long-term strategy if planning to work beyond State Pension age. This might involve retraining for less physically demanding roles or exploring consultancy opportunities. Apart from the financial boost it offers, working beyond State Pension age can provide purpose, social connection, and mental stimulation.
Ready to take control of your retirement planning? Call us today on 0345 450 4660.
