9 in 10 are falling short of retirement targets
More than 9 in 10 (92%) people are falling behind on their retirement savings targets, according to a comprehensive research study.
A survey of more than 4,000 people carried out by Aegon UK found that nearly every respondent was failing to set aside enough money to support them in retirement, and also discovered that almost a quarter (22%) have no idea how many pension pots they have.
If you are unsure about whether you are on target to retire at your desired retirement age, or would like assistance so as to enhance your savings, speaking to a VouchedFor financial adviser can help.
The research, carried out as part of Aegon’s UK readiness report, also discovered that 6 in 10 (59%) are unaware of the benefits of pensions consolidation, while 68% have never considered consolidating their pension, despite the potential financial benefits.
We spoke to Peter Lee, an IFA based in Plymouth, who had this to say in the wake of the research’s findings:
“We often see prospective clients who have both a particular retirement age in mind and an idea of the income they would require to achieve their goal. However, the majority are genuinely shocked and surprised at the level of funding required to reach their targets.
“For many, they have simply left it too late to start funding at a realistic level, and they face an uphill struggle to achieve that which they desire. More often than not, they are forced to re-adjust their expectations.
“I recently worked with a client who had a clear aim of retiring at the age of 60, and by establishing his financial situation we were able to demonstrate the levels of funding required to achieve his goal.
“As an example, we made adjustments to his salary and bonus payments. Income was directed into pension contributions, and this had the effect of moving him out of the higher tax band. We have agreed and set up regular reviews to monitor the funding, performance and investment strategy going forward.
“Our advice is to both start early and to regularly review the funding position of your pension. Current tax relief of contributions still favours pension plans as an effective way to save for retirement.”