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Topics: Scottish Widows| Pension| Retirement
A fifth of workers are failing to save anything for retirement, a survey of more than 5,000 people suggests.
The latest report by Scottish Widows also found those aged between 30 and 50 are falling behind older people in saving for retirement.
Some 59% of those aged over 50 are preparing financially for their retirement compared with 47% of those aged 30 to 50.
The survey also suggests savings in the UK are at a lower level than in France, Germany and Spain.
"We appreciate the difficulty in setting aside extra money," said Ian Naismith (pictured), from Scottish Widows.
"The message is that everyone should be putting aside as much as they can afford for their retirement."
The survey suggested that, on average, people would like £24,300 a year to live comfortably at the age of 70, and aim to retire just short of their 62nd birthdays.
Pensions experts say it would require a large pension pot to be saved by each individual to achieve this level of retirement income, and the report suggested that people were falling some way short, the BBC reports.
Some 49% of those surveyed were not making adequate provision for their retirement - defined as saving at least 12% of earnings a year, Scottish Widows concluded.
This figure has never been below 46% or above 52% in the equivalent surveys from the past five years.
Meanwhile, Scottish Widows called for a change to the terminology used by the government that would make people aware of how much support they would receive from the state.
This could include expressing the proposed flat-rate state pension as £7,300 a year, rather than £140 a week, it suggested.
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Rubbish
What SWF means is that 20% don't give money to life offices for their retirement. Everybody who works gives plenty - it's called tax and I'll wager that the majority think that their 'National Insurance' really is just that - a fund for their pension and welfare. This is a con and a Ponzi scheme that successive UK governments are guilty of since 1946. If this was done in the private sector there would have been a lynching. Sure we have a low savings ratio. Ask why and compare to the 1980’s. Could it be that we have more stealth taxes? Could it be that we are the most indebted (per capita) nation in the World – yes World. Germany, France and Italy didn’t let every Tom, Dick and Harry take out 100% mortgages with X 7 earnings multiples. They don’t impoverish their students before they even begin their working lives – but then they also don’t offer Mickey Mouse courses for every numptie to get a (worthless) degree. So where does the money go - well for a start about £10 billion is just given away to foreign countries - it's called Aid. The largest recipient is an Atomic Power and one of the most robust economies in the world. The counties mentioned above give far less as a proportion of their GDP – so in every aspect show better sense than do we. Whatever happened to 'Charity begins at home'?
Posted by: Harry Katz
Pay off debt first
Personally I focused on paying off my mortgage first before looking around for investment vehicles. The after-tax return is reliable and reborrowing is not difficult. 60% tax relief on pension contributions was handy though, for those that remember the 1980s and/or joint taxation of married couples.
Posted by: Paul
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Interference
Why would a basic rate taxpayer want to save in a plan that was designed to lose 3/4 of the capital in return for a taxable income that included dead people's money? The system is immoral. (The new post 75 rules will not apply to BR taxpayers.) And now at a swipe the spouses of dead drawdown clients (pre 75) will pay an extra 20% tax (up from 35% to 55%) if they want their spouse's savings pot. Why would anyone want to save in a plan that was so exposed to state interference? Another example: "So you thought you could get at some of your money at 50? Forget that. It's 55 now!"
Posted by: Ken Durkin