As the UK’s population ages, many tradespeople are wondering if they’ll need to work beyond retirement age. Recent research has revealed some concerning trends about the future of work for those in the UK construction industry and other manual trades.
Let’s dive into the details and explore what this means for tradespeople.
What is the state pension age in the UK?
The current state pension age in the UK is 66 for both men and women. This means you can start claiming your state pension once you reach this age, provided you have made sufficient National Insurance contributions throughout your working life.
However, the state pension age is set to increase in the coming years. Between 2026 and 2028, it will rise to 67, and there are plans for it to increase further to 68 between 2044 and 2046. This means that younger tradespeople may have to wait even longer before they can access their state pension.
Do tradespeople plan to work beyond retirement age?
A recent study surveyed 500 tradespeople about their plans for retirement. These are some of the key findings:
- One in five surveyed tradespeople said they would have to work beyond the state pension age of 66.
- One in ten reported that they would definitely have to work longer than they’d like.
- One in four UK tradespeople think it’s a possibility they’ll need to keep working after pensionable age.
Interestingly, the survey revealed significant differences between male and female tradespeople when it comes to retirement expectations:
- Almost three times as many male tradespeople think they’ll have to work past the age of 66 than tradeswomen (29% vs 10%).
- 7% of men believe they’ll work beyond 70, compared to just 2% of women.
From painters to builders: Who’s most likely to delay retirement?
The likelihood of working past the state pension age varies across different trades. The trades most likely to think they’ll have to work past 66 are:
- Painters and decorators: 30%
- Electricians: 29%
- Landscapers: 25%
- Joiners: 23%
- Builders: 19%
On the other hand, bricklayers are the most confident about early retirement, with 94% saying they expect to retire before the age of 66. On average, brickies think they’ll retire at the modest age of 56.
Why are tradespeople pessimistic about retirement?
There are a few reasons why such a large proportion of tradespeople are pessimistic about their chances of finishing work when they hope to:
Lack of financial planning
13% of workers aged 55 to 64 don’t have financial retirement plans. Additionally, less than half of those in this age group have a personal pension (49%) or a workplace pension (46%) despite being in the twilight phase of their careers.
Physical demands of the job
Many trades involve manual labour, which can take a toll on the body over time. Older workers may find it more difficult to continue working at the same pace and intensity. This could lead to a need to work longer to make ends meet.
Impact of the pandemic
The COVID-19 pandemic significantly impacted many industries, including construction. Some tradespeople may have had to take time off work due to illness or lockdowns, which could have affected their ability to save for retirement.
How can tradespeople prepare for retirement?
Here’s how you can increase your chances of being able to hang up your tools when you want to:
Start saving early
The earlier you start saving for retirement, the more time your money has to grow. Even small contributions can add up over time, so get into the habit of putting money aside each month. Consider the lifestyle you want and how much money you’ll need to support it. This can help you set realistic goals and financial plans for retirement.
Consider a personal pension
If you’re self-employed or your employer doesn’t offer a workplace pension, you may want to set up a personal pension. This allows you to save for retirement on your own terms, with the added benefit of tax relief on your contributions.
Make sure you’re entitled to the full state pension
To get the full state pension, you need to have paid National Insurance contributions for at least 35 years. Check your National Insurance record to see if you have any gaps, and consider making voluntary contributions to fill them.
Consider diversifying your income
Explore ways to generate passive income, such as investing in property, which can provide additional financial security as you age. Also consider transitioning to less physically demanding roles within your trade. This will allow you to continue working while reducing the strain on your body.
Protect the future of your business with Tradesman Saver
The prospect of working beyond the state pension age is a reality for many UK tradespeople. However, with proper planning and financial management, it’s possible to create a more secure retirement.
Whichever trade you’re in, having adequate insurance is a crucial part of protecting your financial future. At Tradesman Saver, we offer comprehensive insurance packages tailored specifically for tradespeople, starting at £54* per year. Our policies include essential covers like public liability insurance and a range of additional covers to give you complete peace of mind.
Protect your business against unexpected events today. Get in touch with us or complete our quote form to get started.
Tradesman Talk
Do you think you’ll have to keep working beyond retirement age? Have you started planning for life after work? Share your experiences in the comments below.
Until next time, make sure it’s Tradesman Saver!
