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10 Sep 2014

EU: Britons Take Pensions Earliest In Europe, But Work Longer

New EU data reveals that Britons access their pensions earlier than people in the rest of Europe – but that we continue working into an older age, The Telegraph reports.

Conducted by The European Commission, the research shows that the average Briton took their pensions at age 58; but that nearly 20% were still working at age 65 and beyond.

Only a small number of eastern European countries saw people taking their pensions earlier than in Britain – including Poland, where the average age for receiving a state pension was 57. However, only 9.5% of their 65-69-year-olds were still in work, compared to Britain´s 19.4%.

Conversely, the average Spanish worker accessed their pensions aged 62, with just 5% working past the age of 65 (the same figure as France); and in Norway and Iceland, the average age of those taking their pensions was even higher, at 65 – a seven year gap compared to the UK. Only seven countries had a higher working age figure than Britain.

Based on 2012 data, the results suggest that British workers were making poor choices about their savings at this time, forcing them to work to an older age than those in other countries.

However, the research doesn´t state whether the over 65-year-olds remained in work through choice or necessity. For example, although Norwegians didn´t access their pensions until 65, they had the highest rate of 65-69-year-olds in work, at 26.3%.

Experts suggest the results are due to the fact that Britain is “a nation of homeowners,” meaning that many savers access their pensions early to pay off their mortgages.

From April next year, savers will be able to access their entire pension pot from the age of 55. But experts advise them to explore “every possible alternative” before putting all of this money into their mortgage.

“Your pension should be your last resort,” said financial adviser David Smith.

“Too many people think of their pension first, and then find the remaining money doesn´t provide much old-age income. They either have to keep working or their savings run out too quickly.”

Copyright © M2 Bespoke 2014

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