IFS research: Understanding retirement in the UK

There have been large changes in employment and retirement behaviours in recent decades across the developed world.

This report is designed to provide new evidence on retirement patterns in the UK, as part of the Pensions Review, a larger project run by the IFS in partnership with the abrdn Financial Fairness Trust, which is examining the future of financial security in retirement. 

It seeks to understand how patterns of employment and retirement have changed, both before and after state pension age, and how people finance their retirement. 

Key findings:

• Employment declines significantly after age 55, accompanied by rising rates of self-reported retirement.  
• Long-run trends in retirement and employment patterns for men and women are dramatically different. Employment rates of men in their late 50s and early 60s are still lower than they were in the mid-1970s. Women are much more likely to be in paid work in their late 50s and early 60s than in the mid-1990s or before.  
• People with average levels of wealth in their late 50s and early 60s have the highest employment rates (76%) compared with the poorest fifth (46% employment rate) or the richest fifth (65%). 
• Above state pension age, the state pension forms a very important part of income even for middle- and high-income people.