A new study has revealed the sizeable gap between aspirations and reality when it comes to retirement.
One in five British adults over the age of 40 think they’ll be working until they physically have to stop, according to a survey from Aviva. In spite of this, 3 in 10 have no plans in place to fund their retirement.
The average adult would like to retire at around the age of 60, but 64% of over 40s are worried that they won’t be able to meet their day-to-day living costs without their salary coming in, and two thirds wish they’d started to plan for retirement earlier in life.
Clive Bolton, Managing Director of Retirement Solutions at Aviva, commented on the findings:
“For many, their retirement is a time they are looking forward to, whether it’s to get away from the pressures of work or simply having more time on their hands.
“But worryingly, it seems there are a large number of people who are so concerned about what their financial situation is going to be like, they are beginning to consider the possibility that they will always be working.
“I’m sure there are a small number of people who simply don’t want to give up work, but most would rather spend their retirement doing what they want to do, rather than continue to work.
“And while some will be working to ensure they have enough money to have the kind of retirement they are hoping for, it seems there are some who will still be getting up every day to go to work simply to pay the bills.”
More than three quarters of people surveyed said they’re worried about being able to afford all the things they plan to do during their retirement, and yet 3 in 10 have no plan in place. Of those that do have a financial plan, 64% admit it probably won’t be enough to cover all their costs.
“Your state pension is unlikely to cover everything you want to do during your retirement and cover unexpected expenditure, so it’s important to have some kind of financial plan in place to provide additional funds to give you some breathing space.
“The change to pensions and annuities announced in this year’s budget now mean you can spend your pension pot how you want, but given we’re all living longer too, it’s still important to make sure you have enough put by to cover your annual costs for the long term.”