Nearly one in four workers ‘think retirement will be a financial struggle’

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Older workers are more downbeat about their chances of having enough money to enjoy themselves in retirement than younger employees, a survey has found. Only one in seven people aged 56 to 65 think they will have enough cash to really enjoy their retirement, as do 12% of 46 to […]

Older workers are more downbeat about their chances of having enough money to enjoy themselves in retirement than younger employees, a survey has found.

Only one in seven people aged 56 to 65 think they will have enough cash to really enjoy their retirement, as do 12% of 46 to 55-year-olds, Aviva found.

This compares with nearly a quarter of 22 to 30-year-olds and 19% of 31 to 45-year-olds who are confident they will have enough put by to really enjoy their later years.

Across all age groups, nearly a quarter of workers believe their retirement is likely to be a financial struggle.

Automatic enrolment has brought millions of people into workplace pension saving, although there are concerns that people may not be putting by enough for a comfortable retirement.

In April 2019, minimum contributions will rise to 8% of earnings, including top ups from employers and the Government, although Aviva said just saving the minimum is unlikely to give people the pension pot they will need for a comfortable retirement.

Travelling, pursuing hobbies and giving money to children and grandchildren will be the top priorities for people when they do retire, the survey of more than 2,000 22 to 65-year-olds across the UK found.

Alistair McQueen, head of savings and retirement at Aviva, said: “Retirement should be something we all look forward to, but we should be aiming to thrive, not just survive.”

A Department for Work and Pensions spokesman said: “Average pensioner incomes have reached their highest levels since records began thanks to the Government’s commitment to the triple lock and wider reforms.

“Automatic enrolment into workplace schemes has boosted the pensions prospects of almost 10 million people so far, setting them on the path to a financially secure retirement.

“We know there is more to do in terms of increasing contribution rates, and a further rise is due in April.”

Aviva has three general tips for being financially prepared for retirement:

1. Aim to start saving at least 40 years before your target retirement date.

2. Try to save at least 12.5% of your monthly salary towards your retirement, including contributions from the employee, employer and government.

3. Aim to have saved at least 10 times your annual salary by the time you reach retirement age.

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