One in five tradespeople don’t plan to fully retire

One in five tradies admit they don’t ever expect to fully stop working as retirement planning remains an afterthought for many in the industry.

New joint-research from commercial insurer NFU Mutual and construction group On The Tools has revealed a gap in future-proofing for tradespeople and how they plan to fund life after leaving the trade.

With 20% of those surveyed saying they don’t expect to ever give up work, it’s perhaps unsurprising that half of tradespeople also admit they have done no planning for retirement, and a quarter have no pension arrangements in place. Despite that, more than eight in 10 in the industry say they are confident that their business will see them through to the time they decide to call it a day on working.

While such a large number of tradies may be confident in their business continuing up to that point, 44% of those surveyed said they were actually unsure how they would make their exit, pointing to a need for more understanding and information on the topic. More than one in 10 said they plan to hand their business over to a family member.

Martin Ansell, pensions expert at NFU Mutual, said: “With tradespeople often being self-employed, it’s extremely important to future plan finances and look at life in retirement. The fact this joint-research with On The Tools shows so many don’t ever expect to fully stop working could be due to their love of the job, but could also be due to financial reasons and not having enough in place.

“Trades work is also labour-intensive and means some may have to stop before they ideally would want to – highlighting the importance of having those discussions sooner rather than later. We would always recommend that people speak to an expert to get their finances in order.”

Working in a variety of roles, life on the tools is a demanding job for those of all ages, where injuries and illness can become commonplace and time off may be needed. However, with many being sole traders or self-employed, that can have a big impact on income.

Martin added: “All trades are demanding jobs and can often come with their own dangers, so it is worrying that the research shows a third of those surveyed revealed they had no provision financially if they were unable to work.

“More than two in every five tradespeople said they didn’t have enough spare money to look at retirement planning, which really shows the challenges the industry faces.”

When it comes to those who have received financial advice, just 7% say they have taken professional advice, with one in 20 tradespeople claiming they would take pension advice from another tradie instead.

Lee Wilcox, Co-founder & CEO of On The Tools, added: “There’s no doubt that most tradespeople are grafters who take real pride in what they do, so it’s not surprising many can’t picture a future where they’re not on the tools in some way. But this research highlights a more worrying reality – that for too many, continuing to work isn’t always a choice, it’s a necessity.

“At On The Tools, we speak to tradespeople every day, and what’s clear is that long-term financial planning often takes a back seat to the day-to-day pressures of running a business and earning a living. The industry needs more accessible support, education and honest conversations around pensions, savings and exit strategies, so tradies can look forward to a future that’s on their terms – not one dictated by circumstance.”