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Catch up with the latest press releases from LV=

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LV= responds positively to the Government announcement on scrapping the default retirement age

Press release: 13/01/2011

John Perks, LV= retirement solutions director, comments: "We welcome the Government confirming its plans to abolish the default retirement age (DRA). The promise from the Coalition Government, which is now being put into action, will come as relief to those over 50 who may already be concerned about how they will fund their retirement if they are forced to retire earlier than they want to. Our research shows 4.5 million[1] over 50s expect to work past the current state retirement age by an average of six years[2], and 2.7 million[3] of these plan to do so because they will not be able to afford to retire.

"From an individual perspective, scrapping the DRA should help people take more control of their retirement plans without the fear of being pushed out of work and needing to rely solely on the State and any private pensions for income. This should result in better planning for retirement and greater flexibility, which also highlights the importance that financial advice will play, not only in financial advisers helping their clients retire in confidence, but also working though the complexity of the change in rules. Taken into context with other Government announcements, such as removing the need to buy an annuity at age 75, we are finally seeing the shift in it being made possible for people to take personal responsibility for their retirement.

"This move will also help to stimulate the economy and businesses as people are living longer and enjoying healthier lives. Our research also tells us one in five (20% or 4.3 million)[4] over-50s who had retired have since gone back to work. A third (34%) of those returning to work said they missed working and 32% were looking for a new challenge. Over a quarter (26%) went back to work because their pension (state and/or personal pension) wasn’t enough to support their retirement lifestyle. The scrapping of the DRA should help to make life easier for those who wish to continue working and could also help to boost pension savings overall."

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All 2010 figures taken from omnibus research carried out by Opinium Research on behalf of LV= as part of the Working Late Index. An online poll of 1,551 British adults, all aged over 50, was carried out from 29 October - 2 November 2010.

The over 50s population in the UK is currently 21,573,000 – source: population projections by ONS, 2009. All grossed up figures in this press release are based on this source.

[1] 21% of the over 50s population want to, or expect to work past state retirement age = 4.5 million. Calculation based on :
- All working male respondents (aged 50-54) saying they expect to retire over 66, males (aged 55+) answering over 65, and all females answering over 60

312 out of 1511 over-50s expect to work past retirement age. 312 / 1511 = 21% 21% of 21,573,000 = 4.5million.

[2 ] 56% up to five year delay (average 2.5 years)
25% 5-10 year delay (average 7.5 years)
19% 10-20 year delay (average 15 years)

Weighted average is 6.13 years

[3] 60% of those who will work past state retirement age cannot afford to give up work = 2.7 million
Calculated (4.5million who expect to work past state retirement age -see note 1 above) x 60% = 2.7 million.
Base for this question = 312 respondents who will work past state retirement age

[4] 20% of over 50s population have retired then gone back to work = 4.3 million
Calculated from questions:
- Have you previously retired and then gone back into work?
- 20% multiplied by 21,573,00 = 4,314,600.00

About LV=

LV= is a registered trademark of Liverpool Victoria Friendly Society Limited (LVFS) and a trading style of the Liverpool Victoria group of companies.

LV= employs around 4,000 people, serves over 4 million customers and members, and manages around £7.9bn (as at 30 September 2010) on their behalf, via LV= Asset Management (LVAM). We are also the UK's largest friendly society and a leading mutual financial services provider.