More than 500,000 people are continuing to work past retirement age as ’silver entrepreneurs’ and the growing numbers require a new approach to auto-enrolment and pensions policy, according to the provider which carried out the research.

Old Mutual Wealth and the Pensions Policy Institute carried out a study which found that this group was growing rapidly. Over half a million ‘silver entrepreneurs’ are now working for themselves beyond retirement age and many more are self employed.

One in 10 of the UK’s 5m self-employed now employ themselves beyond state pension age. The research suggests that this comprises 347,000 men and 173,000 women (520,000 in total). The number of self-employed working over state pension age has increased by over 20% since 2013, up from 432,000.

The new research also reveals that 1 million more people have become self-employed since the 2008 financial crisis, with the Baby Boomer generation (those aged 50-69) seeing the fastest growth. They now account for 1.9 million of the UK’S 4.8 million self-employed, suggesting the number of self-employed people working beyond retirement age will continue to grow, says Old Mutual Wealth.

Previous research shows some don’t feel ready to stop working or enjoy the social benefits. However, others feel they need to keep working for financial reasons, because they cannot afford to retire. These people could be turning to self-employment as  they search for a flexible source of income or it may not have been a choice. Some may have struggled to find other opportunities given their age, suggest the company.

The government needs to ensure older workers aren’t driven into self-employment as a last resort, the organisations warn.

Jon Greer, head of retirement policy at Old Mutual Wealth, says the figures highlight that the self-employed are key to the forthcoming review of auto-enrolment policy. He said: “Many people are now choosing to phase-out their career and combine work and retirement, rather than simply dropping out of the workforce altogether and going straight into full-time retirement. This trend extends to the self-employed, with silver entrepreneurs now numbering around half a million.

“We’re working longer for all sorts of reasons. Because we value the health benefits, don’t feel ready to finish working or because rising life expectancy means we need to save more. But we can’t ignore the fact that some people are working longer because they can’t afford to retire. That is why the forthcoming auto-enrolment review is crucial. The government need to ensure that today’s 30, 40 and 50 year old self-employed (people) are saving into a pension so that they can choose when to retire, whether in their 60s, 70s or beyond.”

“And it should go hand in hand with the government’s longer working lives strategy, which is designed to help alleviate some of the risks and costs of an ageing society. The government needs to ensure that the strategy also takes into account the growing self-employed population, who are also extending their time in work, according to this data.”

Simon McVicker, IPSE Director of Policy, said: “Self-employment is experiencing an unprecedented boom, with a particular growth in those aged 60 and above. Working in later life should always be a choice though, unfortunately, some people continue working because they don’t have the financial provisions in place to retire.

“It is imperative that we develop some long-term solutions so that today’s young people have greater financial security in older age. Reports like this are a great contribution to that discussion.”