Under 45s worry they’ll never be able to retire
A healthy 75% of people aged between 45 and 64 hope to retire between the ages of 55 and 65 but only 39.3% of those aged under 45 hope to retire by then. However, only 18.5% think it will be possible.
The research by data site Moneyfacts revealed a shortfall in the expectations of consumers when anticipating retirement income. Rachel Springall, finance expert at Moneyfacts, said: “Many younger consumers seem to be realising they can expect a later retirement, or in some cases, worry they will never truly retire.
“Our study shows that while only 3.8% of respondents aged between 45 and 64 feel they won’t be able to retire until after the age of 70, more than a quarter (25.9%) of those under the age of 45 feel the same way. Even more concerning is the result that 14.8% of those under the age of 45 don’t expect to retire at all, compared to only 2.6% of those aged 45 to 64.”
However, the research found that users are relatively savvy with keeping tabs on their pension pot as 55.7% knew how much they have amassed.
“However, there were still around a third of respondents with only a rough idea of what they had saved (31.3%), while 5.4% hadn’t even started saving for retirement,” Springall said.
“Clearly, not everyone prioritises the need to save towards retirement in the same way, while many may pin too much of their hopes on the state pension. Consumers should make every attempt to save an adequate amount of their income to ensure a more comfortable retirement. If left by the wayside, retirees could find themselves with very little disposable income.”
Springall added that while auto-enrolment is a welcome step towards saving for retirement, it shouldn’t be assumed the bare minimum will be sufficient to cover what individuals expect to retire on.
“According to our survey, consumers hope to retire with a pension pot that can give them 63% of their current level of income. However, they realistically expect to only receive 52% of this. Either way, it will require diligent saving throughout their working lives.
“Consumers should make every effort to prioritise their retirement provisions, particularly if they are getting close to retirement age. Keeping an eye on any investments and/or appointing an independent financial adviser to manage the pot through the years can make all the difference when it comes to realising one’s retirement hopes and expectations.”