Image caption Retirement can affect your mental health, the study suggests

Retirement has a detrimental impact on mental and physical health, a new study has found.

The study, published by the Institute of Economic Affairs (IEA), a think tank, found that retirement results in a "drastic decline in health" in the medium and long term.

The IEA said the study suggests people should work for longer for health as well as economic reasons.

The government already plans to raise the state pension age.

The study, which was published in conjunction with the Age Endeavour Fellowship, a charity, compared retired people with those who had continued working past retirement age, and took into account possible confounding factors.

Philip Booth, programme director at the IEA, said the government should go further to deregulate labour markets and allow people to work for longer.

No 'normal' retirement age

"Working longer will not only be an economic necessity, it also helps people live healthier lives," he said.

Edward Datnow, chairman of the Age Endeavour Fellowship, said: "There should be no 'normal' retirement age in future.

"More employers need to consider how they will capitalise on Britain's untapped grey potential and those seeking to retire should think very hard about whether it is their best option."

The study suggests there is a small boost to health immediately after retirement, before a significant decline in the longer term.

Retirement is found to increase the chances of suffering from clinical depression by 40%, while you are 60% more likely to suffer from a physical condition.

The effect is the same for men and women, while the chances of becoming ill appear to increase with the length of time spent in retirement.