Their Golden Age of Retirement report shows that only 51% of people retire at the age they expect to do so, with ill health and redundancies limiting planned pension contributions and reducing the value of savings.
This comes as the government reviews state pension ages, with those forced to give up work early facing the possibility of a ‘double whammy’ of a longer period with no state pension to draw on, and a reduced pension size due to lost contributions.
Aegon pensions director, Steven Cameron, said: “With the likelihood of further state pension age increases, a growing proportion of people will simply be unable to stay in work until their state pension kicks in.
“This is why it is crucial for the government, and the Cridland review, to allow people access to their state pension from an earlier age, for example 60, at a reduced level to make it cost-neutral.
“This would mirror the pension freedoms we now have within private pensions and reflect the changing and more varied needs of individuals in later life.”
People in the UK on average currently hope to retire to some degree by the age of 64, with many opting for a gradual transition from full-time work to retirement through part-time jobs.
"With the concept of a fixed retirement date fast disappearing, people no longer excitedly count down the days until they receive their gold watch or carriage clock,” Cameron continued.
“Indeed, an increasing number relish the opportunity to stay actively in work. The changing nature of work, attitudes towards retirement and greater pressures on income mean there’s no set pattern to retirement any more.”
These findings coincide with encouragement from the UK’s Chief Medical Officer, Dame Sally Davis, for individuals to remain in work beyond traditional retirement ages in order to remain socially, physically and mentally active, all of which can be beneficial for health.
Her Baby Boomers: Fit for the Future report shows that more than 75% of people aged between 50 and pension age are still in active employment, while it is estimated that a third of British workers will be aged over 50 by 2020.
She said: “People are living longer than ever and so retirement presents a real opportunity for baby boomers to be more active than ever before.
“For many people it is a chance to take on new challenges, it is certainly not the start of a slower pace of life as it once was.
“Staying in work, volunteering or joining a community group can make sure people stay physically and mentally active for longer. The health benefits of this cannot be underestimated.”