- From 10k steps to dietary supplements and cold therapy, Nutmeg research shows UK adults are five times more likely to focus on health longevity over wealth longevity
- But only one in seven think they’re definitely saving enough for retirement
- Receive cash investment boost or Avios if you transfer a pension to Nutmeg between now and 30th November
London, [09] September 2024 – As the longevity movement continues to sweep the developed world, new research from J.P. Morgan owned digital wealth manager Nutmeg suggests while we are focusing on improving our physical health, we are spending less time on ensuring our future financial health.
New data shows that, when it comes to planning for the future, the UK population is five times more likely to prioritise physical longevity compared to its financial longevity (51% vs 9%). That’s despite us tending to worry about both in almost equal measure (financial health 42%, physical health 48%)1.
The research shows we are increasingly pursuing a range of measures to boost wellness and physical longevity, with 44% of those surveyed saying they strive to hit 10,000 steps a day. Meanwhile 30% are investing weekly in premium dietary supplements (e.g. protein shakes) and 16% in eating a specialist diet (e.g. raw, Keto or paleo). One in 10 (9%) also use hot or cold therapies weekly.
However, as a nation we fall short when it comes to paying the same attention to our financial longevity. Only 16% use financial apps on a weekly basis to help with budgeting, one in five (20%) don’t know how much of their income they are contributing to their pension each month, and nearly two-thirds (61%) say they have never consulted a financial adviser.
Claire Exley, head of financial advice and guidance at Nutmeg, a J.P. Morgan company, said: “Growing momentum around physical longevity and wellness means that many of us are committed to living longer, but this also means we need to make better financial provisions for our future. There’s a lot of inertia towards retirement planning – pension pots can feel hidden away through poor online access, disengaging paperwork and low transparency on fees and performance. And that’s before accounting for more urgent financial commitments that make retirement saving seem a distant concern.
“However, the trends of rising life expectancy combined with more and more of us staying active for longer needs to match the spending patterns we’ve come to expect in retirement. Traditionally we spend more at the beginning of retirement and this reduces over time as we become less active, however living longer healthier lives will likely mean we want to be doing more of the things we enjoy for longer. Just like the payoffs from lifestyle choices, investing time too in our financial health can really maximise long-term benefits, especially alongside financial guidance on how to achieve the retirement lifestyles we desire.”
Health vs. wealth?
However, this disconnect doesn’t mean the UK is completely overlooking the importance of pensions, with Nutmeg’s research confirming many of us feel we need to be doing more to help the longevity of our wealth keep up with the longevity of our health. When asked about advice they’d give to their younger selves, over a third (37%) said they’d say to think about their future wealth in the same way as their future health.
Only one in seven (14%) think they are definitely saving enough for retirement, despite expecting to need 27 years’ worth of retirement income on average. Meanwhile, 44% say that having a pension or savings plan is as important, if not more so, for a longer fulfilling life as having a gym membership, yet UK adults are twice as likely to track their steps (37%) as their investments and pensions (18%).
Claire Exley added: “Not having started retirement planning earlier is one of the most common concerns people have, but giving your pensions a longevity boost doesn’t need to be a chore. Keeping on top of your pensions and understanding if you’re on track to be able to retire when you want with the level of income you want might be easier than you think. There’s a variety of online calculators to help you understand how much you should be putting away. And for those wanting the reassurance of speaking to a person, free financial guidance or paid-for financial advice could help identify specific retirement goals and navigate tax allowances.”
Claire Exley, Nutmeg’s Pensions Expert, serves pensions advice with a cold press to help class-goers at Vita think about their financial longevity, as well as their physical. Issue date: Monday September 9, 2024. PA Photo. New research from J.P. Morgan owned digital wealth manager Nutmeg found that UK adults are five times more likely to focus on health longevity over wealth longevity and just under half of people surveyed strive to hit 10,000 steps a day while only 16 per cent use financial apps on a weekly basis. Photo credit should read: Matt Alexander/PA Media Assignments
Top tips from Claire Exley to boost the longevity of your pension
1. Make the most of employer contributions
All employers must offer a pension to staff aged 22 and over and under state pension age, with a percentage of your pay automatically added to the pot every payday. Most companies will also contribute to their employees’ pensions either matching or bettering their contributions. Some employers offer very generous pension contributions, so it’s always a good idea to find out about yours.
2. Trace your pensions
These days it’s unusual for us to only have one job, and it’s very easy to lose track of different workplace pensions throughout your career, so you may want to consider bringing some or all of your pension pots together. It’s important to check you won’t lose any valuable benefits before you transfer.
3. Understand and maximise tax efficiencies
Pensions can be a tax-efficient way of investing for your retirement, with tax relief giving you a potential sizeable boost to your contributions. To encourage people to put money away for their retirement, the government currently adds the money you would have paid in income tax to your pension when you make a pension contribution. Basic tax relief – at 20% – may be paid at source by your pension provider, such as Nutmeg, but if you are a higher-rate or additional-rate taxpayer then this amount could rise to 40% or 45%. However, this is something you may need to organise via a self-assessment. In practice that means if you contribute £80 to your pension, the government will add £20 as tax relief.
4. Start young (if you can)
It might not be top of your priority list in your 20s or 30s, especially when retirement feels like a long way in the future, but starting young gives the money you invest more time to benefit from compounding. This is the idea that the money you invest today generates a return, that return is then reinvested and has the opportunity to generate further returns. It sounds simple, but compounding can significantly increase your total pot – especially over a long timeframe.
5. Be realistic about your goals, contributions and timeframes
Putting money away for your retirement shouldn’t mean not being able to enjoy today, it’s about having a realistic plan. Think about when you might like to retire, the sort of lifestyle you’d like when you do and how much that may cost. There are free online pension calculators that can help you understand how much you need to be investing now. If you’d like the reassurance of speaking to someone, then you could benefit from financial guidance or advice.
Pensions and Lifetime Savings Association – Retirement Living Standards
| Age when starting pension contributions | Individual pensionerMonthly contribution / Total pension pot at 65 | Retired couplesMonthly contribution / Total pension pot at 65 | ||||
| Minimum £14,400 | Moderate£31,300 | Comfortable£43,100 | Minimum £22,400 | Moderate£43,100 | Comfortable£59,000 | |
| 20 | £419 / £877,000 | £913 / £1,908,000 | £1,257 / £2,626,800 | £653 / £1,365,200 | £1,257 / £2,626,800 | £1,721 / £3,595,900 |
| 30 | £601 / £720,000 | £1,309 / £1,565,000 | £1,802 / £2,154,900 | £936 / £1,120,000 | £1,802 / £2,154,900 | £2,468 / £2,949,900 |
New and existing clients who initiate a transfer valuing at least £5,000 from existing pensions to Nutmeg by 30th November can choose to have a cash investment boost or Avios. Terms and conditions apply, for more information visit: https://www.nutmeg.com/promo/pension-transfer-offer
