Is it Worth Waiting Until State Pension Age Before Retiring?

Retirement is a major life decision that calls for careful planning and consideration. It’s perfectly normal to have many questions as you approach this milestone, with one of the most common being: Is it worth waiting until your official State Pension age to retire?

Just as a quick reminder, the State Pension age in the UK is currently 66, with plans to raise it to 67 by 2028. This leaves many people wondering: Is it better to wait until this age to retire, or could retiring earlier be more advantageous?

In this blog, we’ll discuss the pros and cons of waiting until State Pension age to retire and help you figure out if it’s the right choice for you.

What Does Retiring at State Pension Age Mean?

In the UK, the State Pension age is when you can start getting your State Pension—a regular payment from the government to help you during retirement. If you were born after 1960, this age is slowly going up and will likely keep rising in the future.

When you reach State Pension age, you can start claiming your full State Pension, provided you have enough qualifying years. Learn more about the requirements here. However, you don’t have to stop working unless you choose to.

Lots of people choose to keep working, either full-time or by cutting back their hours to ease into retirement more gradually. This can help you avoid the shock of suddenly stopping work altogether. Plus, working while getting your State Pension gives you extra financial breathing room and keeps you active and involved. If retirement feels a bit daunting, take a look at our blog for tips on how to handle any anxiety you might have:  https://www.joslinrhodes.co.uk/retirement-planning/are-you-afraid-to-retire/

The Benefits of Waiting Until State Pension Age

It might seem like a long way off, but waiting until you hit State Pension age to retire can actually bring some great benefits. In fact, waiting could boost your financial stability and improve your retirement plans in ways you might not have considered.

Let’s break it down:

Financial Security

Financial security is key when you’re thinking about retirement. Without it, it can be difficult to feel confident about your future. One great benefit of holding off until you hit State Pension age is the financial boost it brings. By that time, you’ll likely be set to get the full State Pension, which can give you a steady income on top of any workplace or private pensions you might have. So, waiting a bit longer can really help make your retirement more secure.

Bigger Pension Payments

It might seem obvious but staying at work until you reach State Pension age can really boost your pension savings. You’ll have more time to contribute to your workplace or personal pension, which means you’ll end up with a larger income for retirement.

State Pension Boost

If you choose to delay claiming your state pension, you can increase the amount you receive. For every 9 weeks of deferral, your State Pension grows by approximately 1%. Over the course of a year, this equates to just under 5.8%.

The extra amount is paid with your regular State Pension payment.

Maximising Your Savings & Investments

Working longer gives you a chance to save and invest more, which is great if you’re worried your pension might not be enough for retirement. The extra time means you can add more to your savings, boosting your financial security for the future.

Avoiding Longevity Risk

People are living longer these days, and many of us end up spending 20-30 years in retirement. That’s a lot of time to make the most of your savings and work toward the retirement you dream of. By delaying your retirement, you can make sure your pension lasts longer and reduce the chance of running out of money.

The Downsides of Waiting Until State Pension Age

While waiting until State Pension age has its perks, it’s important to also be aware of the potential downsides. Let’s discuss what to consider before making your decision.

Health Considerations

Working longer can boost your finances, but it might come at the expense of your health. Many jobs are physically and mentally demanding and continuing to work into your late 60s can become increasingly tough, especially if health issues arise.

Health should be a top priority because, without it, working effectively and enjoying life can be harder. As you get older, health problems can affect your ability to enjoy retirement. Delaying retirement might mean fewer years to live an active, healthy lifestyle. To make the most of retirement, good health is key.

Workplace Stress

Continuing to work into your late 60s may add stress, especially if your job is physically demanding or high-pressure. After years in the same role, it’s easy to lose enthusiasm, and that can take a toll. Many people find that retiring early helps them avoid the extra strain and enjoy a more relaxed lifestyle.

Missed Opportunities

The best years of retirement are often filled with travel, new hobbies, and, most importantly, spending quality time with loved ones—things you might not have fully enjoyed while working.

For many, retiring early is a chance to be with grandchildren or support elderly parents. Waiting until State Pension age means putting off these precious moments. By retiring sooner, you can embrace these opportunities while you’re still healthy and active.

It’s all about finding the right balance between stepping into retirement with enough time to enjoy these experiences and ensuring you’re financially secure.

Our experts are here to help you navigate that balance and make your retirement everything you’ve dreamed of. Here are some things we recommend considering.

Deciding whether to retire at State Pension age or earlier really comes down to your personal situation, including your financial security, health, and retirement goals. For some, working until State Pension age offers the financial stability needed for a comfortable retirement. For others, the desire to retire early and fully enjoy their golden years might outweigh the benefits of waiting.

The best choice is the one that fits your financial needs and personal dreams. It’s important to review your pension savings, lifestyle goals, and overall health before making a decision.

A financial advisor can provide invaluable guidance during this process. Our experts are dedicated to helping you create a retirement plan that aligns with your aspirations. With the right strategy, you can look forward to a fulfilling and worry-free retirement, whether you choose to retire early or later. We’ll help you understand exactly how much you need, giving you the clarity to decide when you can afford to retire—possibly even sooner than you imagined.

Even if you’re enjoying work and don’t feel ready to retire yet, but want reassurance that everything is on track, we’re here to help you plan out of choice, not necessity. You don’t need to see us only when it’s urgent; we’re here to provide the clarity you need to feel confident about your future.

Careful planning is key to making the most of this exciting new chapter in your life. Reach out to us today to get started!

Joslin Rhodes Pension & Retirement Planning – Real Advice, For Real People