A recent survey has revealed that confidence in pensions has grown but a quarter of people still think owning a property is a better way to fund their retirement.
Saving for retirement
More than half of workers in the UK – or about 57 per cent – now view pensions as the most secure way to save for retirement, up from just 47 per cent a decade ago, figures from the Office of National Statistics show.
But 25 per cent think investing in property is the safest way to save for the old age – an attitude that reflects a very British ‘obsession’ for bricks and mortar, according to experts.
According to the survey, 43 per cent of people believe property is most likely to generate the best return, compared to only 33 per cent saying they thought pensions would give them the best investment outcome.
Overall, there has been an improvement in the way people perceive pensions over the past decade.
Some 45 per cent think a pension from an employer is the safest way to save for older age, while one in eight 12 per cent believe that a personal pension is the best bet.
Confidence stems from auto-enrolment
Eight years of auto-enrolment seem to have made a difference for some, as over half, or 55 per cent, say they are confident of having a level of income that can support the sort of retirement lifestyle they aspire to.
That is up significantly from just 40 per cent in 2010-12 – when auto-enrolment was only just being introduced.
However on the flip side, this means 45 per cent of Britons still feel they don’t have enough to have a good standard of living in retirement.
Bearing in mind that a substantial sum in excess of around £300,000 is needed to just provide a relatively humble annuity in retirement, there is still a long way to go to convince savers to start saving enough early in their careers.
Seek professional advice
Pensions are a complex area and an independent financial advisor is ideally placed to provide information and advice on the best route to take.
For more information contact Becky Hammonds on 07969 269677 or email becky@willowfs.co.uk
