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Phasing into retirement: The flexible options you might consider

by RPG Chartered Financial Planners

Traditionally, you’d go from full-time employment to retirement on a set date. Now, more workers are embracing retirement flexibility and choosing to phase gradually into the next stage of their lives. Indeed, a survey published in September 2024 by WTW found that 49% of UK workers aged over 50 are already phasing into retirement or want to do so in the future.

Alongside calculating the income your pension could provide and planning a retirement bucket list, you might want to dedicate some time to thinking about how you want to retire.

Over the next few months, we’ll explore key considerations for those interested in phased retirement, including the financial implications. 

Read on to find out why more people are phasing into retirement and how you might do it. 

Longer life expectancy is one of the reasons more people are phasing into retirement

There are many reasons why someone might choose to phase into retirement, and one factor that’s playing an important role in the trend is longer life expectancy.

According to data published by the Office for National Statistics in February 2025, the average 55-year-old man has a life expectancy of 84. For a 55-year-old woman, it’s 87. 

So, if you were to retire in your mid-50s, on average, you’d spend around three decades in retirement. For some people, giving up work completely with decades ahead of them can feel daunting, and a phased approach could better suit their goals. 

Among the other benefits of phasing into retirement are:

  • Striking the right work-life balance 
  • Enjoying the social life or purpose that work may provide
  • Giving you time to adjust to a retirement lifestyle and budget
  • Providing an income to supplement your pension or other assets.

4 ways you could phase into retirement

If phasing into retirement sounds like it could suit you, there’s more than one option to explore. Here are four ways you could phase into retirement. 

1. Reduce your working hours

If you’re happy in your current role but want to benefit from increased flexibility, reducing your hours could help you achieve the work-life balance you’re looking for.

Whether you shorten the working day or work a three-day week, you could increase your free time to spend on activities you’re interested in. 

2. Move to a less demanding role

As you near retirement, you might want to adjust your priorities and take on a less demanding role to focus on the aspects of the job you enjoy. This option could help reduce stress while remaining connected to a wider team. 

When you’re weighing up your options, be sure to set out what’s right for you. Do you want to move into a position that requires less physical labour, or take a step back from managing people?

3. Take on freelance or consulting work

If you want the freedom to set your own schedule, freelance or consulting work could be an option worth exploring. As you’ll be in control, you can create a work-life balance that’s right for you or focus on projects you’re passionate about. 

If you’ve thought about starting your own business in the past, a phased retirement could provide an opportunity to test your entrepreneurial skills. You might turn a hobby into an income stream or continue to provide support for businesses you work with in your existing role. 

4. Explore volunteering

If you’re in a financial position to stop working but aren’t ready to give up the structure and social interaction it provides, you could benefit from volunteering. 

The great news is that there are thousands of volunteering opportunities across the country, helping you to find a role that suits your skills and interests. Whether you choose to lend a hand at a local food bank or mentor young professionals, you could have a meaningful impact on other people and your community. 

Contact us to talk about your retirement plans

A phased retirement could offer you a chance to strike a work-life balance that suits you. If you’d like to talk about how you could phase into retirement and its potential effect on your finances, please get in touch.

Next month, read our blog to find out more about the wellbeing and financial benefits of phasing into retirement. 

Please note:

This blog is for general information only and does not constitute financial advice, which should be based on your individual circumstances. The information is aimed at retail clients only.

A pension is a long-term investment not normally accessible until 55 (57 from April 2028). The fund value may fluctuate and can go down, which would have an impact on the level of pension benefits available. Past performance is not a reliable indicator of future performance. 

The tax implications of pension withdrawals will be based on your individual circumstances. Thresholds, percentage rates, and tax legislation may change in subsequent Finance Acts.

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