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07/03/2014 - Will you have to "work till you drop"?

pensionTwo out of three of us are now resigned to working beyond the age of 65.

Most people say they have no other option as the soaring cost of living means they cannot survive on their pension alone.

The latest research, by Canada Life Group Insurance, found that 66 per cent of those surveyed said they would have to work past the age of 65.

The concept of retiring at 65 and no longer earning a wage is only a dream now for many.

Canada Life spokesman Paul Avis said: “The concept of retiring at 65 and no longer earning a wage is fast ­becoming antiquated as more and more employees accept they will be working long beyond the traditional retirement age.

“Increased life expectancies and recent economic difficulties have boosted the proportion who feel they will be forced into working longer than they want to in order to afford the rising cost of living.”

The survey of employees found that the soaring cost of living was the main reason they would have to supplement their pension with a wage. Just 28 per cent said they would continue working because they enjoyed their job.

Today almost one person in 10 over the age of 65 is still working – an increase of 10 per cent in a year. Experts have long warned that the UK faces a pension “time bomb”. The closure of almost all "final salary pension schemes in the private sector has been one of the main causes.

Those retiring mortgage-free today and wanting a “reasonable” lifestyle, including two holidays-a-year, need at least £25,000-a-year according to some experts.

On the Global Retirement Index the UK is rated 77th (out of 150) – one of the lowest rankings among Western nations – and behind developing countries such as Botswana, Cameroon, Colombia and Guatemala.

Tom McPhail, head of pensions research at wealth manager Hargreaves Lansdown, said those in their 40s and 50s today will be worst-hit. He added: “They’re too young to get a decent final salary pension and too old now to build up a decent retirement fund.”.

Pat Harrington, General Secretary of the Solidarity Trade Union, commented:

"People still don't realise how bad the pensions crisis is. The average pension pot will not pay a decent, regular payment. The destruction of final salary schemes, changes in pension rules and an economic climate where people don't have money to put away have all contributed. Radical measures are needed to solve this problem".