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According to one report, up to 48 per cent of people fear their pension savings will not be enough to last until retirement.
And around 56 per cent said they had not saved enough money for retirement, according to research by Investec Wealth & Investment.
Women were shown to be more worried than men: 61 percent reported worries, compared to 53 percent of men.
Worry about money: a third of people over 65 fear running out of funds in retirement
While older people were the least worried, a third of those over 65 believe they could run out of money in retirement.
Of those over 65 who said they were not worried, 43 per cent have a last salary pension.
Being part of a final salary plan, also known as a defined benefit, means that your previous employer guarantees you a secure income based on the salary you earned and the years you were affiliated with it.
But these schemes are now mostly closed to new entrants unless you work in the public sector. Defined contribution pensions, now prevalent in the private sector, take payments from both the employer and the employee and invest them to provide a reserve of money at retirement. But they are stingier and savers bear the investment risk, rather than employers.
Among those aged 45 to 54, a whopping 70 per cent reported being worried about the current size of their pension fund, making them the most worried about their retirement.
However, those under 45 are not far behind: 67 percent fear not having enough for retirement and 57 percent fear running out of money during retirement.
In Scotland, 68 per cent said they are worried about not having enough money for retirement, while 62 per cent of Scots are also worried about running out of money in retirement.
The South East was also high on the list, with 64 per cent worried about not having enough and 57 per cent fearful their pension would run out.
Only in the east of England and in Yorkshire and the Humber were majorities who said they were not worried about not saving enough.
| Region | Worried about not having enough money for retirement | Worried about running out of money in retirement |
|---|---|---|
| Scotland | 68% | 62% |
| Southeast | 64% | 57% |
| northwest | 61% | 46% |
| Northeast | 61% | 44% |
| London | 60% | 47% |
| West Midlands | 57% | Four. Five% |
| Welsh | 55% | 55% |
| East Midlands | 53% | 59% |
| South west | 51% | 47% |
| This | 49% | 42% |
| Yorkshire and the Humber | 41% | 44% |
Ade Babatunde, chartered financial planner at Investec, said: “It is worrying to see the large number of people with retirement savings who fear running out of money in retirement and not having enough money saved.”
‘Part of this may be because people worry ahead of retirement and that’s a good thing if it encourages them to save more and seek professional financial advice.
“Ideally, people would want to save as much as possible for as long as possible and we recommend anyone concerned about retirement savings to speak to a financial advisor.”
Only one in five new retirees can afford to top up their state pension with an annual income of £31,300, the amount needed for a “moderate” lifestyle, compared with one in three a year ago, according to the Pensions Association. and Lifetime Savings.
The income needed for pensioners to lead this lifestyle has increased by 27 per cent over the last year, with a couple now needing £43,100, compared to £34,000 last year.
PLSA income figures do not include taxes, housing costs – if you still rent or have a mortgage – or care.
According to Investec research, 77 per cent of retirees have reported a drop in their monthly income since leaving their degree, with a drop of more than 50 per cent for a quarter of retirees.
Meanwhile, 67 percent of those not yet retired said they expect their income to fall, and only four percent anticipate an increase.
Is it too late to increase your pension?
Helen Morrissey, head of retirement research at Hargreaves Lansdown, suggests first determining what kind of lifestyle you want to have and then how much you will need to fund it.
“Figures like the PLSA retirement income standards are useful as a starting point, but everyone has a different idea of what they want their retirement to be like, so costs vary,” he told This is Money.
At this point, you will be able to determine if your pension is in line with what you need. Morrissey said: ‘Pension calculators can be hugely useful in helping you work out what you’re on track to receive and the potential impact of saving a little more. Using them regularly can really help you stay on track.”
If you think your pension is behind what you want, there are options to help you increase it before you retire.
Morrissey suggests increasing payments into your pension: ‘Take the opportunity to increase contributions wherever you can, for example if you get a pay rise or a new job. It’s easier to do this before you get used to having extra money and spending it.
‘If you increase your pension contribution, your employer may have a contribution matching policy that can help you boost your pot without you having to do all the hard work.
“Committing to your pension throughout your working life and taking these steps wherever possible can take much of the fear factor out of pensions and help you plan for the future with more confidence,” Morrissey said.
How to manage your pension if you fear it will fall short
1) If you are worried about whether you have saved enough, investigate your existing pensions. In general terms, it is necessary to ask the following questions to the schemes.
– The current value of the fund.
– The current value of the transfer, because there could be a penalty for the transfer.
– If the pension is a final salary or defined contribution regime. Defined contribution Pensions take contributions from both the employer and employee and invest them to provide a reserve of money at retirement.
Unless you work in the public sector, they have now mostly replaced the more generous gold-plated ones. defined benefit – average or final career salary – pensions, which provide a guaranteed income after retirement until death.
Defined contribution pensions are stingier, with savers bearing the investment risk rather than employers.
– Whether there are guarantees (for example, a guaranteed annuity rate) and whether you would lose them if you moved the fund.
– The projection of the pension at retirement age. You can use a pension calculator to see if you will have enough; They are widely available online.
2) You must add the expected figures to what you expect to receive in the state pension, which is currently £203.85 a week or around £10,600 a year if you qualify for the new full rate. Get a state pension forecast here.
3) If you’re tempted to merge your old pensions, read our guide first to make sure you won’t be penalized.
4) If you have lost track of the old pots, the The government’s free pension tracking service is here.
Be careful if you search online for Pension Tracking Service, as many companies using similar names will appear in the results.
These will also offer to look for your pension, but they will try to charge you or hit you with other services, and they could be fraudulent.
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