Don't work until you're dead

Take this action now or you could be forced to work until the day you die.

Some people just cannot give up working.

My Granddad is a classic example - he formally retired about 18 months ago, at the age of 82. 82 years old! Can you imagine working at 82?

My Granddad absolutely loved his job, as a sales rep for a publishing house, and could never give it up. All through his 70s he worked a day or two a week, commuting into London to see all his mates and discuss the world of books. By his 80s this had at least fallen to a day a week, but I know it was a wrench for him to give it up.

He chose to keep doing it though - it wasn't a case that he had to keep working for financial reasons, thank goodness.

However, new research suggests more and more of us might be working well into our retirement out of necessity.

The man from the Pru says no retirement for you

A new survey by Prudential has outlined just how likely it is that we will all still be working in our twilight years. The firm surveyed finance directors at UK businesses and found that just shy of a quarter (24%) said they expected staff to work beyond retirement age over the next decade.

Currently around 752,700 people are working at beyond the retirement age, equivalent to about 2.6% of the workforce. However, if these predictions are right, that would see the number of workers going past retirement age more than double to 1.8 million people, or 6.3% of the workforce.

Some may end up working until they die, without ever getting a chance to retire.

If, like me, you don't much fancy the sound of that, what can you do? Thankfully there are some very simple ways to ensure your pension pot is sufficient to pay for your later life.

Start your pension as soon as you can!

It's just common sense that the earlier you start paying into your pension, the more you will have waiting for you when you eventually get to retire. And what's more, even small amounts can really grow to a sizeable pot thanks to the magic of compound interest.

Let's take Jack, a 25-year old man earning £25,000 a year.

If he saves £100 a month towards his pension, he will retire with a pension pot which would be worth just under £100,000 today, or an annual income of around £4,200. If he delayed starting that pension by five years, he would instead retire with a pot which would be worth just under £70,000 today - a difference of £30,000. That would equate to an annual income of just £2,940 today.*

So by saving an extra £6,000 in his twenties, he will have the future equivalent of an extra £1,260 to live on in retirement, every year for the rest of his life.

Every little helps!

In truth, very few of us pay as much as we probably should do towards our pensions each month - hand on heart, I know I don't. But even the smallest contribution can make a significant difference when the time comes to pack up work.

If Jack didn't save a penny towards his pension, opting to rely on the State Pension, then if things stay as they are currently he would have £95.25 a week to survive on. Not exactly a fortune. But even saving £50 a month can make a difference - by the age of 65, Jack would have an annual income of just over £2,000, or an extra £40 a week.

Indeed, by upping your pension contribution by £100 a month you can eventually up your pension pot by a whopping £94,000.

Also, if your employer offers a pension contribution scheme, then you should always take advantage of it - it's quite literally free money! The extra pounds that they chuck in could make the world of difference.

Put it in a safe place!

Do you know where your pension funds are invested? And do you know how those investments are performing? I'd wager the vast majority of people in this country with private pensions wouldn't have the first idea with either of those questions.

And that's daft really - that money is supposed to pay for your lifestyle once you actually have the time to enjoy yourself a little, so it shouldn't be asking too much for us to actually engage with how much we are going to have to play with!

If your fund is underperforming, work out how much it would cost you to move it. If that still looks worthwhile, then follow the tips in How to pick the best pension funds to ensure you get the most out of your retirement money.

Get wise to the loopholes!

Immediate vesting. Purchased life annuity. The triviality trick.

Nope, I'd never heard of any of them either.

But thankfully my colleague Jane Baker has shed light on these clever tricks which will help you boost your pension pot. If you don't fancy working into your 80s, then quite simply you cannot afford not to read Three ways to boost your pension you've never heard before.

*Assumptions: Pension fund grows at 7% p.a. An annual charge of 1% is deducted. The fund value takes inflation into account at a rate of 2.5% p.a. Contributions increase in line with inflation at a rate of 2.5% p.a.

Get help from lovemoney.com

If you are planning for your retirement, but need a helping hand, then you've come to the right place!

First, adopt this goal: Get ready to retire.

Then, watch this video: Prepare now for your twilight years!

And finally, why not have a wander over to Q&A and ask other lovemoney.com members for hints and tips about what worked best for them?