Planning ahead for pensionhood starts young – Aegon

Planning ahead for pensionhood starts young – Aegon

Investors pushing retirement planning to the bottom of their priority list are storing up trouble for later in life, David Macmillan has warned.

The managing director of Aegon UK said: “It is worrying to think that consumers are pushing saving for their retirement to the bottom of their priority list.

“The pension industry must to do more to engage with consumers from a younger age and make pension saving a lot more tangible. Putting money away should be easy.”

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He said that digital solutions could help people engage with and understand their saving needs and plans earlier.

This comes as research from Axa Wealth showed that pension reforms, which came into effect on April 6, had led many over-55s to consider using their retirement cash to set up a small business.

Aegon said that just a fifth of people it surveyed were prioritising saving for their retirement over other shorter-term goals, and that almost half of UK consumers would rather save for time away in the sun than for their pension

Saving for a holiday is followed by other ambitions, such as paying for children’s education in 37 per cent of cases, paying off debt, at 25 per cent and a deposit on a home at 21 per cent.

Adviser view:

Michael Brooke, financial planner at Cheshire-based Clarion Wealth Planning, said: “New pension freedoms are increasing the profile of pensions, but now more than ever people need to be made aware of the need to put money away for retirement.”