UK leads way in developed world as 60% of high net worth indivduals vow to keep working beyond retirement

News - Savings

Written by Ray Clancy

Monday, 27 September 2010 12:42

The traditional concept of retirement is being rejected by a new breed of wealthy individuals who want to carry on working for as long as they are able, a new piece of research shows.

Some 60% of high net worth individuals in the UK want to keep on working and will never retire and the report from Barclays Wealth reveals that the UK is the most likely of developed economies to have so many continue working.

The ‘nevertirement’ trend set to grow in popularity as younger respondents say they will always be involved in work but it means that important financial decisions could remain unresolved as work takes precedence, the report warns.

The aim of many is not just to keep working but to start businesses and take on new projects in later years, the latest Insights series report, The Age Illusion: How the Wealthy are Redefining Their Retirement, also shows.

The report, the twelfth in the Barclays Wealth Insights series, is based on a global survey of 2,000 high net worth individuals globally, who were asked to consider what retirement and later life means to them.

Some 70% of respondents under the age of 45 said that they will always be involved in some form of work. Whilst a desire to remain in work might be expected to chime with business owners and entrepreneurs, the findings apply to all wealthy respondents, with 57% of those who inherited their wealth saying they too will continue working in later life.

Although the emerging markets show the biggest desire to keep on working in later life, the UK leads the way amongst the developed economies. In the US, 54% of respondents expressed a desire to carry on working, with Switzerland 34%, Spain 44% and Japan 46%.

‘Whilst in previous generations there have always been an energetic few with the health and specific drive to keep actively challenging themselves well past the standard retirement age, many looked to create their wealth early on in life with a view to enjoying it when they retired,’ said Greg Davies, head of behavioural finance at Barclays Wealth.

‘This report reflects a different attitude, with wealthy individuals as a group wanting to continue to challenge themselves well beyond the traditional retirement age, which is now likely to comprise a significant proportion of their total lifespan. Indeed, for many their working life is an important part of who they are, it is something from which they derive self-worth and value, and not just a necessary evil to be endured until they can enjoy a leisurely retirement,’ he added.

There are a number of factors driving the notion of Nevertirement, according to David Semaya, head of Barclays Wealth, UK and Ireland Private Bank. ‘Whilst higher life expectancies and concerns about an unpredictable economy are almost certainly relevant, it is fascinating to see that wealthy people are continuing to work for a variety of other reasons, and indeed that this appears to be something that is set to continue in future generations,’ he added.

Rather than look to later life as a time of leisure or years of old age, 77% of Nevertirees view this period as ‘just another phase of their life’, suggesting that the traditional retirement age no longer marks any significant milestone in terms of their general lifestyle.

However, the report demonstrates that as well as wanting to keep on working, the wealthy are using the later years to re-examine their options with regards to work, looking for different careers and positions, often moving from the role of execution and control to that of influence.