Extending working lives and the subjective financial wellbeing of mid-later life workers

Abstract Despite a UK policy focus on extending working lives and delaying retirement, the number of workers aged fifty-plus in the workforce has declined post-Covid. The reasons for this decline are not entirely clear. Based on face-to-face interviews with fifty-four UK workers age sixty-plus, this study highlights the important role subjective financial wellbeing plays in the decision-making process regarding retirement timing. Findings show that the current UK state pension age is rarely seen as the ideal retirement age. Notably, the study reveals that mortgage redemption significantly enhances subjective financial wellbeing amongst mid-later life workers. However, prioritising mortgage redemption can lead to pensions being cashed in early and could ultimately lead to poorer long-term financial outcomes. Accessing pensions before retirement is viewed as a way of reducing the risks of income pressures prior to receipt of state pension, and of facilitating phased retirement. The study also highlights the relative and context-dependent nature of how individuals assess their financial situation and overall financial wellbeing as they age.