740,000 side hustling pensioners
- An estimated 740,0001 small business owners and sole traders may be unable to afford to fully retire
- One in seven (14 per cent) small business owners and sole traders say they can’t afford to retire and will run their business as a side hustle when they start drawing their pension
- Small business owners and sole traders in Greater London are most likely to need to work past-retirement age
New research2 from Direct Line business insurance reveals one in seven (14 per cent) small business owners and sole traders will continue running their business as a side hustle as they draw their pension because they can’t afford to retire. It is estimated over 740,0001 side hustling pensioners will need to work to supplement their retirement income.
With London being one of the most expensive cities to live in the UK, it is perhaps not surprising that almost one in five (18 per cent) small business owners and sole traders in Greater London say they will need to work to supplement their pension when they reach retirement age.
Building up a company takes hard work and dedication, with business owners experiencing varying degrees of success, which will no doubt influence retirement plans. Many (20 per cent) small business owners and sole traders are still undecided on what to do with their company when they retire. A fifth (22 per cent) plan to fold their business upon retirement and a similar proportion (21 per cent) plan to sell the firm to either a third party, employees or a friend. A further one in six (17 per cent) say they hope to hand their business over to a family member to run when they retire.
Table 1 - What small business owners and sole traders plan to do with their business when they retire?
| Plans for the business | Percentage |
| Fold/ rundown the business | 22 per cent |
| Sell the business to a third party, employee or friend | 21 per cent |
| Unsure | 20 per cent |
| I can't afford to retire, so I will continue the business as a side hustle | 14 per cent |
| Pass on to a family member to run (I think they will want to run it) | 10 per cent |
| Pass on to a family member to run (but I don't think they will want to) | 7 per cent |
| Give away the business to a friend or employees | 5 per cent |
Source – Direct Line Business Insurance 2025
Mark Summerville, SME Product Manager at Direct Line business insurance commented: "Being a sole trader or running a business is hard graft. Business owners need to juggle numerous responsibilities day-to-day, but it’s also important to plan for the future. Working beyond the state pension age can of course have several financial benefits. If you are fit and enjoy your work it can help keep you mentally stimulated and give you a sense of purpose in retirement. However, that’s not always the case and if the work is physically and mentally demanding, the need to work post-retirement age could easily become a challenge.”
ENDS
Notes to editors
According to the Department for Business and Trade 5.51 million businesses were small (0 to 49 employees) in 2023: Business population estimates for the UK and regions 2023: statistical release. 13.55% of small business owners and sole traders say they ‘can't afford to retire, so I will continue the business as a side hustle’ 13.55% of 5.51 million = 746,605
Censuswide survey of 502 Small business owners/sole traders. The data was collected between 24.07.2024-26.07.2024. Censuswide abides by and employs members of the Market Research Society and follows the MRS code of conduct and ESOMAR principles. Censuswide is also a member of the British Polling Council.
For further information please contact:
Direct Line Group
Unni Henry
PR Manager
Email: unni.henry@directlinegroup.co.uk
About Direct Line business insurance
Launched in 2007 Direct Line business insurance now has over half a million customer policies, providing a flexible range of insurance products for the landlord, van and small business sectors.
Direct Line business insurance policies are underwritten by U K Insurance Limited, Registered office: The Wharf, Neville Street, Leeds LS1 4AZ. Registered in England and Wales No 1179980. U K Insurance Limited is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority.
Direct Line business insurance and U K Insurance limited are both part of Direct Line Insurance Group plc.
Customers can find out more about Direct Line business insurance products or get a quote by calling 0345 301 4827 or visiting https://www.directlineforbusiness.co.uk.