For those 12 months away from retirement, confidence in plans that will allow them to retire comfortably is mixed according to the latest research from M&G Wealth.
M&G Wealth’s Retirement Revisited Report reveals that only 1 in 3 (35%) are very confident in their retirement plans. This compares to the largest proportion (42%) who are only slightly confident, while a worrying 1 in 5 (20%) say they are not confident in their retirement plans.
Even among those who are confident, there is an imbalance between men and women. Almost 7 in 10 (66%) men are confident that their retirement plans will enable them with a comfortable retirement, in stark contrast to under half of women (48%).
For those who are looking to make up for a shortfall in sufficient income to fund a comfortable retirement, the most popular solution among those surveyed was to move to a smaller property (31%). A separate 23% said that they would release equity from their home, and 13% said they would use the inheritance that they planned to leave their loved ones.
However, how they anticipate paying for care stirs up a greater worry. This comes as a result of rising residential care fees, which currently range from £27,000 to £39,000 a year with a rise from £35,000 to £55,000 if nursing care is needed1.
Only 1 in 3 (33%) of those 12 months away from retirement still don’t know how they will fund care, with only 15% saying that they plan to fund the care costs through the sale of their property, while 3% say they plan to move in with their children in this situation.
Catriona McInally, investment expert at M&G Wealth, said: “The prospect of needing care later in life and how it will be paid for can often be an uncomfortable subject and is therefore potentially avoided. That being said, it is important to be aware that what you will pay for social care is dependent on what level of care you require as well as how much you have in savings.
“Rising inflation rates, and the cost-of-living crisis, have undoubtedly added pressures surrounding people’s retirement plans and funding more immediate spending needs is understandably the focus for many right now.
“Speaking to a professional financial adviser about how to best to plan your retirement will not only help to give you increased confidence in your plans but can help you plan how you’ll finance future care requirements.”