New research has just revealed that less than half of over 50s are confident that they can fund their retirement.
The figures come from a Close Brothers Asset Management report which surveyed a number of UK adults approaching retirement. It concluded that just 24% felt fully financially prepared to fund their retirement and less than half (49%) of over 50s were confident they have saved enough to ensure a ‘reasonable standard of living’. One in five admitted that they had never contributed to some form of pensions saving scheme.
When it came to seeking advice, over a quarter (28%) of those nearing retirement stated they would consult with Pension Wise, whilst 27% intended to turn to IFAs. What’s more, almost one in three (31%) said they did not intend to take any financial advice prior to, or at the time of retirement.
Penny Lovell, from Close Brothers Asset Management, said: “The new pension freedoms provide those over 55 with almost unprecedented options in retirement. But a worrying number are approaching these new options with one hand tied behind their back financially, without sufficient savings to start with. For the freedoms to have the positive impact intended, people need to visualise the retirement they want to achieve, and then take the necessary steps to ensure they have the finances to support this earlier in their careers.
“The role of financial advice is as important for the younger generations as it is for those retiring. As consumers embark on pension saving, taking on enough risk within their investment strategy is crucial. Without enough exposure to growth, they will not be able to build large enough savings.
Understanding what is an appropriate level of risk is a difficult process without guidance. Marrying financial planning with investment advice can ensure that the right strategy is taken on both sides to make the most of the finances available. The earlier this planning is considered, the more likely retirees are to meet lifestyle goals in later life.”