- Those in the first five years of retirement spend an average of £2,200 a year on experiences, from luxury cruises to taking up a new hobby
- New retirees are making the most of their free time with more than half (52%) saying they want to try new things
- Thousands say they are planning to try adrenaline activities such taking up a new sport, scuba-diving or swimming with dolphins
- Younger generations are inspiring over 65s to try new things, with many seeing gap year exploits and feeling they missed out when they were younger
New research from financial services provider OneFamily suggests over 65s are vying for the title of ‘experience generation’, with research showing they spend an average of £2,200 a year in the first five years of their retirement – a total spend of nearly £5 billion[i] each year.
While millennials are known for their experience-driven lifestyle, the crown should perhaps belong with new retirees, who are spending nearly four times[ii] as much on activities, such as exotic or extended holidays, festivals and other big-ticket experiences.
Over 65s’ yearly budgets for experiences range from less than £200 to over £50,000, but this looks set to rise as many (22%) are shrugging off the current economic uncertainty and planning to spend more on experiences in 2019. The most popular activities for 2019 include holidays with family (35%), sightseeing in the UK (32%), and going to theatre shows (24%).
Those early on in their retirements are the biggest spenders, with many keen to make the most of their work-free time as soon as they can. Two in five (39%) of those who have recently retired expect to splash out over the next five years, either on treats for themselves and their families or on bigger ‘one-off’ experiences.
While more than a quarter (28%) of retirees intend to focus on treats for their families over the next five years, such as holidays, theatre tickets and nice meals, more than half (52%) of those looking to pursue experiences in retirement want to shell out on things they’ve never done before.
The most popular of these is taking a luxury cruise, with one in four (23%) new retirees saying this is on their list, however many are taking the opportunity to try more exhilarating activities. Flying in a hot air balloon is one of the most popular new things that those between 65 and 70 are hoping to do in retirement, with nearly one in 10 (9%) planning to do this. Other adventurous experiences include moving abroad (9%), travelling and living out of a backpack (4%) and even extreme sports such as sky-diving (1%).
Retirees are most eager to explore new countries, with nearly a quarter (23%) planning a ‘once in a lifetime’ holiday. While Europe is a popular destination for many, other travellers are planning to venture further afield, with 15 per cent adding a trip to Asia to their wish list for 2019 and nearly one in ten (8%) looking to visit Central and South America.
Younger generations are inspiring over 65s to explore these unusual destinations and experiences, with three in 10 (30%) saying they have seen younger people having new experiences, and feel like they are missing out. With the majority (89%) agreeing that gap years were not as common when they were younger, three in five (63%) say they are determined to make the most of their retirement.
While three-quarters (72%) of retirees say they’ve held themselves back in the past due to other commitments, many find they now have both the time and money to pursue experiences they were previously unable to. Two thirds (65%) say they are eager to make up for lost time, and 44 per cent say that, having worked hard all their lives, they now want to focus on having fun.
When it comes to funding these experiences in retirement, most (71%) retirees are drawing on savings, however many are thinking of using their property, with nearly one in five (18%) saying they would use the money tied up in their home to pay for experiences if they could.
Nici Audhlam-Gardiner, Managing Director of Lifetime Mortgages at OneFamily comments:
“The traditional idea of retirement has changed, and people are making the most of their free time by doing more of the things they love and taking up new hobbies or activities. Settling down to a quiet, sedentary life is no longer the case, with retired baby boomers splashing out on a range of experiences from going to the theatre to extended holidays or even skydiving. After years of hard work, many are determined to make the most of their retirement, finally having experiences they may feel they missed out on in their youth. However, funding this sort of lifestyle can be expensive – and not everyone has savings or a bursting pension pot to draw from. By unlocking equity in their home via a lifetime mortgage, these people may still be able to enjoy the experiences they’ve long been waiting for.”
[i] According to the ONS population data, there are currently 2,208,035 retirees aged between 65-70 in the UK. OneFamily research shows that those in the first five years of their retirement spend £2,213 on big-ticket experiences a year, a total estimated contribution of £4.9 billion.
[ii] 18-34 year olds spent an average of £620 on big-ticket experiences in 2018, while those who have retired in the past five years spent £2,213.