The retirement age could rise by an average of six months a year, encouraging older people to stay in work longer, under new government plans.
The Department for Work and Pensions has published a business plan, which noted that people were living longer and the retirement age should rise with longevity.
The latest official data, for April to June 2014, showed that the average age men stopped working was 64.7, compared to 64.5 in 2011/12. The average age women stopped working was 63.1, compared to 62.7 in 2011/12. There has been a statistically significant change of 0.7 years for women since April to June 2010, said the department.
DWP's business plan stated that 'an increase in the average age of withdrawal of more than around 0.5 years would demonstrate an improvement', although it would 'not normally expect' changes of that magnitude.
Speaking to The Telegraph, pensions minister Steve Webb said the six-month target was 'ambitious' but added that it was already happening with women who were choosing to work longer.
He said: 'If someone works an extra year they can add 10% to their pension for life. What we are doing is catching up with decades of longer living.
'We are living longer but the labour market and people's retirement age has not been keeping up. I have fought against a vague target of trying to get people to work longer, to have something more specific.'
Commenting on government plans, David Macmillan, managing director at multinational life insurance Aegon, said the change was very likely to come in the next few years, confirming that 'people will work past age 65'.
Macmillan said people could either choose to keep working for longer, or save more at an early age 'but either way savings rates urgently need to increase'.
He said: 'Life expectancy has been increasing at 2.5 years per decade and on average people can expect to live into their eighties. While it's great news that we are all living longer, this means that people's savings will need to last much longer.'
'New reforms which come into place in April next year mean people will be able to access their pension from age 55. We support this increased flexibility and for some people it will make sense to access their cash early, however this needs to be balanced against the need to make savings last over what could be a very long retirement for many people.'