Past retirement trends are no longer a reliable guide to the future and a “radical rethink” is needed for planning for life after the age of 50, according to a report by Aegon.

Dubbed the ‘second 50’, Aegon highlighted how different life after 50 will be compared to previous generations, and called on the government, employers and the pensions industry to collaborate and create a landscape that’s fit for purpose.

It argued that, due to people living longer on average, life after 50 is likely to become multi-staged, with vastly different prospects from those of previous generations, which would mean retirement advice would become a more vital part of financial planning.

Aegon’s research found that only 27 per cent of people currently in employment expect a ‘hard stop’ retirement and are likely to expect a phased journey.

Furthermore, while people aged 50-59 expect to spend 17 per cent of their later life in ill health, only 25 per cent have considered future social care expenses in their retirement planning.

The report argued that people will need personalised help to plan for multiple stages of retirement and that financial planning may need a more holistic approach.

“As we see record numbers of people in the UK celebrating their 100th birthday, we want to start a conversation about how varied people’s second 50 years may be and to help people better understand and navigate them,” commented Aegon pensions director, Steven Cameron.

“For many, seeking financial advice will be of particular value. The ‘second 50’ is a new phase of life that is vastly different to the prospects our parents and grandparents had when they reached age 50.

“There are millions of combinations of circumstances and situations that people over 50 may find themselves living through at various times and in different orders, meaning everyone’s second 50 is truly unique.

“In fact, in many ways, it’s uncharted territory. We can no longer simply look to what’s gone before to know how to manage it on behalf of clients. Our report picks out five fundamentals to consider as you help your clients navigate this journey.”

These five fundamentals were: Work, wealth, family, health and wellbeing.

Aegon noted that, during a person’s second 50, 53 per cent hoped to spend more time with loved ones, 45 per cent planned to travel, and 33 per cent expected to pursue new hobbies.

“We want to explore the second 50 not just with individuals, but with employers, the financial services industry and government, to create a landscape that is truly fit for purpose for everyone’s life after 50,” Cameron continued. “Advisers will bring huge value in navigating that landscape.

“Whether it’s employment and pension law or the state pension, the government has the responsibility to support and the power to shape people’s Second 50. For example, we’d like to see the government offer more flexibility around when people can access their state pension.

“In addition, employers play a vital part in life after 50 by offering flexible working, training, and support at all ages, and by harnessing the skills and expertise of those who wish to continue working for longer. Meanwhile, workplace pensions can help build the financial support needed by employees in later life.”

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