Schroders Haver recently found that a quarter of UK adults with a private pension stopped making payments into their fund since 2008. According to the same research, one-in-five of over 55s have started raiding their pensions savings to meet living expenses.
Robin Stoakley, managing director of Schroders’ UK intermediary business, said: “Millions of Britons are gambling with their financial security in retirement. Worryingly high numbers have stopped paying into their pension, or have drawn on savings earmarked for retirement to fund everyday living expenses. “While this is completely understandable in such tough economic times, people are risking not having sufficient income to fund retirement. Everyone is being squeezed in terms of disposable income, but it is essential people start planning for their retirement at a younger age.
“People need to assess their projected expenditure in retirement and ensure they will have enough income to cover these costs. It is not merely a question of building a big pot of capital; it is about ensuring this is invested so it generates an income to cover living costs once a person has stopped working.”
As Independent Financial Advisors Enable understand that many people have been taking pension holidays as a result of pay cuts or redundancies but paying into your pension should not be seen as a luxury. The recession has continued longer than expected but you still need to try and keep up your pension contributions otherwise there may be the need to face even more difficult decisions later on.
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