Worrying statistics emerge as British public aren’t ready for the cost of living after retirement.
— London. August 2018: The majority of people are failing to prepare for retirement, according to a new survey of men and women in the United Kingdom aged 45 to 65. The survey, by pension and property investment specialists The Landlord’s Pension, found that most people are not putting enough into their pension pot each month and have a small (or even non-existent) pension pot that won’t cover the costs of living.
Most members of the public are also unaware of innovative pension options such as SIPP and SSAS. Few people understand where their pension is invested, what returns they are achieving, how much they are paying in fees or even what their pension is likely to pay them as an income in retirement.
Key Findings from the Pension Survey
-45% of people aged 45 to 65 put nothing into their pension pot each month
-28.8% of respondents put just £100 or less into their pension each month
-Almost 48% of women put nothing in each month, compared to 41% for men
-38% of respondents say that they expect to earn nothing at all from their pension
-32% expect to earn under £800 a month from their pension.
Gareth Bertram, Director at The Landlord’s Pension, states that these figures are very worrying. He says: “People without a pension pot could be left in substantial financial difficulty when they come to retire. A lot of people place their faith in the State Pension but are unaware they have to accrue thirty-five years of National Insurance contributions to qualify for the full amount — which is £164.35 per week. Even those who qualify will earn less than £10,000 per year.”
What Is the Average Pension Pot in the UK? Almost Half Have Nothing
The Landlord’s Pension asked 259 people aged 45 and over how much money they have in their pension pot. Here are their key findings:
40.7% of people that they have nothing in their pension pot
29.5% say that they have less than £50,000
21.1% of women have at least £50,000 in their pension pot
38.5% of men say that they have at least £50,000.
Again, Gareth Bertram worries that some people could be left out of pocket: “For a modest retirement, it is said that a couple needs to have a pension pot of around £210,000. That amount should cover the costs of living and an occasional holiday. For a couple that wants to live comfortably, particularly in London and the Southeast, that number should be over £500,000.
“To learn that many people have nothing in their pension pot is alarming. Everyone wants to enjoy some time at the end of their life without worrying about financial burdens. People without a pension pot won’t be able to achieve that dream.”
Most People Don’t Know Their Options When It Comes to Pension Freedoms
In the 2015 April Budget, the UK government announced “pension freedoms”. This gives people greater choice in terms of how their pensions can be invested and drawn upon in retirement. But have people embraced their new pension freedom and do they even understand what it means? The survey found:
Less than a third of people know what SIPP stands for
Less than a fifth of respondents know what SSAS stands for
70.05% do not know where their pension is invested
73.3% don’t fully understand the charges that are applied to their pension.
Gareth Bertram thinks that many people in the UK could benefit from a deeper understanding of the pension options on the table. He explains: “It’s now possible to take your pension and invest it in property or a business opportunity. For many people, that will provide a much better rate of return than what your typical stocks and shares investment is likely to have delivered over the last 20 years.”
More information is available from The Landlord’s Pension’s press contact Gareth Bertram. To reach the company, call 020 3907 8400 or email at email@example.com. Alternatively, you can find them at Trident House, Trident Business Park, Didcot, Oxfordshire, OX11 7HJ.
Release ID: 395150