UK less bullish than Brazil on funding retirement – survey
Legg Mason Global Asset Management’s retirement survey, which polled 4,000 people in 20 countries, found 85 per cent of investors in the UK are either ‘very’ or ‘somewhat’ confident of having enough money to retire in the style they desire.
This, the research said, was directly in line with the global average.
While UK investors appeared “significantly more bullish” than those at the bottom of the scale – Japan (53%), Chile (62), Italy (66%) and France (68%) – they were less confident than those in China (91%), the US (88%) and Brazil (86%), the survey found.
Low interest rates and ‘catastrophic events’ were seen as the main reasons hampering investors’ retirement plans in the UK.
Some also think the UK government will “not follow up on obligations”, they will live longer than their retirement funds lasts, or they will not save enough for their retirement to begin with.
The majority of UK investors also took a negative view on the environment the next generation will face, compared with the global average of 46 per cent, which declared it would be harder for their offspring than it has been for them.
Legg Mason Head of UK sales Adam Gent said it was “encouraging” investors were positive about their retirement.
But he warned this did not mean they were saving enough to fund their retirement in practice.
He cited Financial Conduct Authority research, which found the typical pot of pension savings used to buy an annuity is just £17,700, which at current rates would generate an annual retirement income of about £1,000.
“Although the Budget has widened pension savers’ at-retirement options, it is clear that people need to be realistic about how much they will need to fund the lifestyle they want in later life and think long and hard about how they plan to accumulate that level of savings,” he suggested.
He added: “Moreover, with almost two-thirds of investors in the UK predicting that the generation behind them will find life financially harder, it is vitally important that savers – particularly those at the younger end of the scale – start thinking about their retirement funding plans sooner rather than later.”