Am I saving enough for retirement? Just two in five people are

Can YOU afford a decent retirement? Just two in five people are on course for a moderate or comfortable pension, report warns

  • New barometer looks at how likely people are to live on a good income in old age
  • Majority look set to miss the target, including a large cohort of affluent people
  • What do minimum, moderate and comfortable lifestyles look like? Find out here
  • Do you need help investing for retirement? Find a financial adviser service
  • Byna 40 per cent of adults are on track to enjoy a decent lifestyle in retirement while the rest are set to struggle, new research reveals.

    A single person needs a minimum income of £20,800 per year, while a couple requires £30,600 to achieve financial security, according to an industry measure of retirement living standards.

    Those figures include the state pension, which is currently worth around £9,300 per person if you qualify for the full flat rate.

    Income plans: Well under half of adults are heading for a moderate or comfortable retirement

    Income plans: Well under half of adults are heading for a moderate or comfortable retirement

    A new savings and resilience barometer launched by Hargreaves Lansdown looked at how likely people of different ages and on different incomes are to achieve a ‘moderateincome threshold or above.

    This found that a higher than average 45 per cent of people aged 40-56 have got their savings on track.

    Hargreaves suggests this could be because they have reached an age when they are more likely to take retirement seriously, and because they could have benefited from generous final salary pensions before they were phased out in the private sector.

    >>>What do minimum, moderate and comfortable retirement lifestyles look like? Find out below

    Intussen, 36 per cent of people aged 25-40 are on course, maar net 18 per cent of under-25s, although these are the generations most likely to benefit from auto-enrolment into work pensions.

    Sommige 70 per cent of high earners, making £102,800-plus a year, are on targetmeaning a sizeable cohort of affluent people could be leaving themselves short in old age.

    The percentage of those making decent provision drops steeply to 47 per cent in the next highest income group of those earning £49,000-£102,800.

    The new Hargreaves barometer is compiled in partnership with the forecasting firm Oxford Economics.

    It is based on data from the Wealth and Asset survey by the Office for National Statisticswhich draws its information from 10,000 huishoudings – plus other data from official sources.

    Hargreaves says the barometer is structured around five pillars of financial behaviourcontrolling your debts, protecting your family, saving for a rainy day, planning for later life and investing to make more of your money.

    >>>Want to get your pension on track? Find a to do list below

    Are you heading for a basic, moderate or comfortable retirement?

    Bron: Pensions and Lifetime Savings Association

    Bron: Pensions and Lifetime Savings Association

    In an attempt to show people what different levels of income in old age will mean to them in reality, the Pensions and Lifetime Savings Association created a measure which splits typical lifestyles into three groups.

    The results indicate how big a shop you might be able to afford each week, where and how often you can take holidays every year, whether you will be able to run a car, and what you might be able to spend on clothes, skoene, presents and your home. Read more here and see below.

    Bron: Pensions and Lifetime Savings Association

    Bron: Pensions and Lifetime Savings Association

    ‘Most people would like to think they will be able to afford a few luxuries here and there during their retirement years,’ says Helen Morrissey, senior pensions and retirement analyst at Hargreaves Lansdown.

    ‘This data shows we are way off track with less than 40 per cent of people on course to enjoy a moderate lifestyle in retirement.

    ‘Without action many people face living only the most basic standard of living in their later years.

    ‘It’s tempting to shelve the longer-term planning when there are pressing demands on our finances. Egter, we know the earlier you start contributing to your pension the better.

    ‘We need people to engage more and if possible, go over and above auto-enrolment minimums when it comes to contributions as over time this can add up and make a huge impact on your resilience in retirement.

    ‘Some employers are willing to pay more into your pensions if you do and so it’s worth asking if this is also available as it can really make a difference over the long term.

    Separate research published today shows the latest increase in the state pension age from 65 aan 66 means significantly higher numbers of both men and women are carrying on working in later life.

    But the Institute for Fiscal Studies, which carried out the study for the Centre for Ageing Better, found the effects were unequal.

    An additional 7 Daar is diegene wat hul profiele op dieselfde manier versier as wat jy dalk 'n CV maak 9 per cent of women are still working at age 65 algehele, but the increase is 10 persent en 13 per cent respectively among people living in the poorest areas of the UK.

    Those who decide to delay retirement due to the rise in the state pension age to 66 are likely to be financially better off as a result, but they lose out on leisure time and other benefits of retirement, according to the IFS.

    How to get your pension on track

    If you are worried about your pension and whether you will have enough, read a full 10-step guide to sorting it out hier.

    To get started, investigate your existing pensions. Broadly speaking, you need to ask schemes the following:

    The current fund value

    The current transfer valuebecause there might be a penalty to move

    Whether the pension is in a final salary or defined contribution scheme

    If there are any guarantees – byvoorbeeld, a guaranteed annuity rateand if you would lose them if you moved the fund

    The pension projection at retirement age.

    You can use a pension calculator to see if you have enoughfind This is Money’s hier.

    You should add the forecast figures to what you anticipate getting in state pension, which is currently £179.60 a week or around £9,300 a year if you qualify for the full new rate.

    Get a state pension forecast hier.

    If you are tempted to merge your old pensions, check out some tips on how to decide hier.

    If you have lost track of old pensions, the Government’s free tracing service is hier.

    Take care if you do an online search for the Pension Tracing Service as many companies using similar names will pop up in the results.

    These will also offer to look for your pension, but try to charge or flog you other services, and could be fraudulent.

    If you are in your 20s, we have a special pension guide hier. Self-employed people can find out how to sort out their pensions hier.

    Vroue, who tend to miss out because they get lower pay and do unpaid caring work, can find out how to increase retirement savings hier.

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