Leaving your retirement saving until the last five or ten years of your working life can be a dangerous strategy. The same can be said for planning to save for retirement by working past the age of 65. It is all very well and good to kick your heels up and enjoy life while you are young, fit and able to travel, but disaster can easily strike as retirement approaches. Statistics show that earnings reach their peak around the age of 45-50 for the average person. As you get older, the risk of redundancy and ill health increase, and a break in your career for either of these reasons means you may then be forced to line up for a job along with much younger and fitter competitors. There is a chance for some people that they will not be able to work full time in their chosen occupation again after a career break late in life.
With life expectancies now in the mid-eighties and rising, the average person can expect to live at least twenty years in retirement, and around half of people will live for longer than that. Twenty or thirty years is a very long time to live on the breadline. You can choose to spend forty or fifty years working and having a ball followed by twenty or thirty years of misery, or you can choose a more sedate but still enjoyable working life followed by a long and comfortable retirement. It’s all about balance. Use a retirement calculator (see here) to work out how much you need to set aside each year to achieve your retirement goals, and whatever you earn over and above that can be spent on whatever you like, safe in the knowledge that your long term future is taken care of.