We’re often told it is important to save money for retirement, but are we really putting it into practice?
New research shows that in many cities across the UK, less than half of workers are confident they are putting enough away for their later retirement life.
A survey by Prudential, who compared attitudes to money and the preparations employees are making for their retirement funds, found that 46 per cent of workers in Plymouth, 44 per cent in Newcastle and 43 per cent in Manchester are confident that they will have enough in pension savings to support a comfortable retirement.
The picture is even worse in Belfast and Cardiff where only 21 per cent and 25 per cent of workers respectively expect a comfortable post-employment life. The situation is a little better in London, but not by much (35 per cent).
Workers estimated they would need a total average annual income in retirement of £21,100, with Londoners believing they will need the most at £26,400, and those in Belfast the least (17,900 a year in retirement).
The Prudential research also looked at the average length of time people can expect to live in retirement, using recently published life expectancy data from the Office for National Statistics. Across the 17 cities covered in the survey, workers expect to retire just before they turn 64, so are looking forward to an average of around 20 years and six months in retirement.
Vince Smith-Hughes, a retirement income expert at Prudential, said the research paints an “interesting picture” of how city-dwelling workers are planning for retirement and the amount of money they hope to save.
“While it is reassuring to see people being realistic about the money they’ll need to live on when they give up work, it is also worrying how many of them fear they haven’t saved enough to be comfortable,” he said.
“The best approach for most people looking to have control over when they give up work and wanting to make sure they have enough savings to support a long retirement is to save as much as possible, as early as possible in their working lives.”
If you believe your employees are worried they are not putting enough money away for retirement, why not contact us at Better with Money today? We offer different courses for those at different stages including: Kicking off your retirement plan, Rebooting your pension planning, Financial planning for the future and our popular Longest holiday of your life workshop? which explores more than just the financial side of retirement.