Millennials deluded about when they will retire – survey finds they expect to quit work at 63

Sam Meadows
·2 min read
The research found older people were more realistic about their retirement prospects - Rosemary Calvert/Getty Images
The research found older people were more realistic about their retirement prospects - Rosemary Calvert/Getty Images

Millennials are deluded about when they will retire, a survey has found, as they expect to quit work at 63.

Among 18 to 34-year-olds the average age given for expected retirement was 63 and eight months, according to the research by pension firm Hargreaves Lansdown, while one in eight said they expected to stop working at 55.

This is despite state pension age being at least 66 and possibly as high as 68 for this age group.

By contrast, older people were more likely to be realistic about their retirement prospects with those over the age of 55 expecting to retire at 67 and 11 months on average.

Sarah Coles, from Hargreaves Lansdown, said: “We have high expectations of retirement – but we may be in for a nasty surprise.

“We see today's retirees downing tools in their early 60s, picking up their largely-defined benefit pensions, and settling in for a comfortable retirement – and we assume we can do this too, at roughly the same age. Unfortunately this is far from true.”

Confidence levels for retirement
Confidence levels for retirement

Many older workers benefited from generous final salary pensions, which link payouts to salary at retirement age and guarantees income, irrespective of market movements.

Most younger workers have defined contribution pensions which they must manage themselves, meaning they could risk running out of money if markets fall or they retire too early.

Ms Coles said that millennials could also lose out by leaving their money in their pension scheme's "default" fund, which might not deliver the same returns as alternatives.

According to the Hargreaves Lansdown research the average expected retirement age for all age groups was 65 and two months, still below the state pension age, while one in five had no idea when they would be able to retire.