Close to a third of over 50s will work on in retirement to top up their pensions, according to a new survey.
The extra cash will add almost 50% to pension payments for many.
The figures show a big future increase of pensioners who will stay in work compared to the one in eight who do so today.
More than half of over 50s spoken to by researchers for the joint study by the Daily Express and Old Mutual Wealth expect to have to work to pay day to day bills, even if they only take a part time post.
More than 1 million over 50s already work after passing the official retirement age and many more will choose to work until they are older as the state pension age increases.
Retiring with debt
The current start date of 65 years old will rise to 66 for everyone by October 2020 and to 67 by 2028.
Then, the government plans to keep raising the retirement bar in line with longevity after 2028.
Around a third of over 50s have a mortgage, credit or store card debt when they give up working which reduces the amount they have to spend in retirement.
Adrian Walker, retirement planning manager at Old Mutual Wealth, told the Daily Express: “The old-fashioned concept of working until you reach an arbitrary age set by the state is dying out.
“Growing numbers are finding that their pension lump sum is not enough on its own to clear all their debts.”
Money was not the only reason many over 50s cited for working beyond retirement age.
Money worries
Almost two-thirds of those who are considering working on explained they were too young to retire, while many others liked the social aspect of working with others.
Falling annuity rates that pay a guaranteed income in retirement were blamed for more over 50s having to work past retirement.
A 65-year-old couple with a £100,000 pension fund can expect an annuity to pay around £4,800 a year – but index-linking to keep the payment in line with inflation reduces the payment to about £2,890 in the first year.
Equity release is also rising in popularity with older homeowners looking for extra money to spend in retirement. Last year, almost £1 billion was borrowed against homes this way at an average £76,300 a property.
