None of us really wanted to consider old age whilst in our mid-20s, but raising the issue and outlining the necessity to prepare for the future is vital, as Karen Barrett, chief executive of unbiased.co.uk, explains; “We (in the UK) could be massively better off if we all got used to the idea of planning for the end of our working life as soon as we begin it.”“Pension saving is cumulative by nature, so time is the single greatest asset on your side. If you start early, then even if you can save only small sums, compound interest over the years can make an astonishing difference.”Research by Unbiased and MetLife has found that:
- Adults are saving £97 a month on average towards retirement, but those who pay for financial advice put aside an extra £71 per month, making £168 in total
- Over the course of 30 years, this works out at an extra £25,730 in the retirement pot of someone who took advice at age 35 (before interest and tax relief)
- Over 40 years, people who took advice at the recommended age of 25 would have an extra £34,000
- People who have taken advice expect to fund a retirement lasting 37 years on average, but those who have not taken advice think they will be retired for just 22 years on average
- People aged in their 30s are the most likely to get advice, and those aged 60 and over are the least likely to do so
- Some 58 per cent of UK adults have never sought financial advice
- And 38 per cent of people surveyed are not making any savings at all for retirement.
With this topic in mind, our blog ‘One In Five Would Rather Die Early Than Retire Poor’, was written last November to highlighted the need for financial awareness at a younger age, and to congratulate the Church of England’s proposal that Primary Schools set up savings clubs for pupils and to encourage children to start saving small, regular amounts of money through a network of clubs run by credit unions.
The Financial Planning Group have over 22 years’ experience in helping our clients shape their finances to fit the life they aspire to. If you would like to speak to us about your own situation or retirement concerns, please call us on 0800 731 7614 or by e-mail at firstname.lastname@example.org and we’d be delighted to help.