The latest Future of Retirement report from HSBC has found that people expect to ease into semi-retirement in their mid-50s before stopping work at an average age of 62 – regardless of the fact that some 17 per cent of the 1,000 adults questioned don't know what their main source of retirement income will be and a further 21 per cent say they will rely on the state pension.
"The emergence of this ostrich generation is a real concern," says David Wells, head of investments, pensions and savings at the bank. "Britons know that they need to plan and save more for their retirement, but they are failing to turn this knowledge into action."
But those who don't bury their heads in the sand enjoy a significant financial and emotional premium, the bank found, as the 39 per cent of people with a financial plan have retirement savings worth more than four times those of non-planners, often managed through an IFA.
"We need a step-change to overcome this ingrained inertia and help people prepare for their retirement." Ian Naismith, head of pensions market development at Scottish Widows, said.
People would like to have an average annual retirement income of £24,300, a significant drop from the £27,900 they hoped to have in 2009. But many who are not members of final salary pension schemes are saving an average of just 9% of their income into a pension each month, only three-quarters of the 12% of pay that Scottish Widows estimates people need to set aside in order to have a comfortable retirement.
It is never too late to start saving, talk to one of Bishop Stortfordsleading IFA’s and make a pensions plan.Readers might also be interested in the following relevant articles:
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