Workers approaching retirement often look forward to spending more time with their loved ones, travelling the world or taking up new hobbies – but this is far from the truth, according to new research.
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The likelihood is those in retirement are saving their cash and deciding not to spend on luxuries and holidays.
Far from worrying about money, around seven out of 10 retirees expect to leave an inheritance of £50,000 or more to their families.
The figures come from a survey from think-tank the International Longevity Centre UK (ILC UK) and financial firm Prudential.
Retirement is not all holidays and hobbies
The report Understanding Retirement Journeys discloses that people stop spending from around the age of 50 and that only those retiring early are likely to spend more time on holiday or hobbies.
The main findings are:
Older retirees spend less
A household headed by an 80 year old spends 43% less than one headed by a 50 year old.
Older households continue to save on average £5,870 a year, tend to keep their cash in low interest accounts and consider that they will leave at least £50,000 as an inheritance. The report found retirement does not trigger a splurge of spending on eating out or other luxuries.
No extra holidays
Time spent at home alone increases as retirees get older, while the time spent with family and friends drops. By the time someone reaches 90, the most common daily routine is spending the day alone and listening to the TV or radio.
Failing health limits retirement activities
Although failing health curbs travel and hobbies, most people say they are fit enough to do what they want most of the time
Retirees need less money
Ben Franklin, head of economics of ageing at ILC UK said: “Pension freedom has sparked a lot of debate about how much money the over 55s spend and whether they have enough to see out their lifetimes.
“The research suggests people need less money as they get older and to save money in their later years. We think some sort of financial review to help these people invest would help the economy while making sure they can still pay their bills.”
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