The company surveyed over 2,000 adults in June and July this year and discovered that for many early retirement was becoming “an impossible dream.” Over one in three were saving “nothing” for retirement and one in seven expected to work beyond their 75th birthday. Many feared that they would never be able to retire.
The average respondent said they wanted to retire at 62 but now expected to continue working until they were at least 67 to build up a big enough pension pot to retire on. Most people said that they would like an annual retirement income of £23,000 a year for a comfortable retirement but only one in ten said that they were on track and 39% believed they needed to increase the amount they saved.
Only one in eight have consulted a professional adviser about their pension. The most common reason given for not taking advice was that they were in a workplace pension scheme (26%). Some 18% said they managed their own affairs; 15% felt their pension pot was not big enough; and 7% said they did not know how to find help. Some 12% blamed the cost and 6% said they did not trust anyone.
Justin Urquhart Stewart, co-founder of 7IM said: “Nearly one in five people tell us they are anxious about their retirement future. That’s awful and for many people it needn’t be like this.”
From the research, 7IM has compiled a list of seven personality types most at risk of pension crisis:
• Cash Strapped – ‘Can’t afford to save anything into a pension’ (23%)
• Procrastinators – ‘Will save when we can afford it’ (27%)
• Inheritance Hopefuls - ‘Hoping for an inheritance to fund retirement’ (10%)
• Downsizers - ‘Planning to downsize their house to fund retirement’ (8%)
• Live For Today - ‘Would rather spend money on experiences to enjoy now’ (12%)
• Head In the Sand – ‘Too worried to think about it’ (18%)
• Caught in the Headlights – ‘Do not understand enough about pensions’ (10%)
(The percentages add up to more than 100% because the people surveyed were given the option to choose more than one category.)
7IM said that more people would be better engaged with their pension planning through the use of technology.
The company said that its 7IMagine app was helping clients to capture details about their own and their families’ finances in as little as 10 minutes and better use of technology could help clients realise what more they needed to do to plan for their retirement.
• The 7IM research was carried out by Opinium and was based on an online sample of 2,025 UK adults between 30 June and 4 July 2017.