Do I need an onward flight booked while traveling to Thailand on a SETV for retirement extension?

You don’t need a flight out of the country with a visa in your passport in order to board the flight from the UK. If the extension of stay whilst in Thailand is your plan, then stick to that plan. If you want to explore the possibilities of getting a one year O-A visa then that’s a whole different thing. I know the London embassy like to point people in that direction, but I always think that it’s best to make your own plans/decisions. The costs, and time taken to get the police reports and medical are not insignificant. Worth finding out, but if you’ve already researched getting an extension when you arrive in Thailand and decided that that’s what you want to do then just stick with that plan.

Just show the check in staff at the airport that you have a visa and you’ll be fine boarding the plane.

I think it it more easy to apply for the Non Immigrant O visa based on retirement before you come to Thailand in stead of the SETV. Than 45 days before the last date apply for the Extension of Stay.

Normally not asked for flights at Immigration checkpoint, but could be an requirement to get the Visa at the Embassy or Consulate. You can if you have 15 days left (some Immigration 21 days) on your Admitted to Stay period apply for the Non Immigrant O visa based on Retirement at your local Immigration Office if you meet the requirements. This takes about 14 days and will be a 90 day Visa. 45 days before last date you can than apply for the 1 year Extension of Stay based on retirement.