Half of UK adults worried about retirement funding

Half of UK adults worried about retirement funding

Half of UK adults are worried they have not saved enough money to sustain their current lifestyle in retirement, research has found.

Some 52 per cent of 1,212 adults surveyed by NerdWallet reported their concern, with 34 per cent of full-time workers saying the state of their retirement finances is a cause of “significant stress”.

Around one in ten (9 per cent) said they doubt they will be able to fully retire, with 37 per cent saying they have a clear retirement savings strategy.

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On average, respondents said they saved £298 into their pension each month, and 24 per cent had reduced their contributions since the start of the Covid pandemic.

Richard Eagling, senior pensions expert at NerdWallet, said the pandemic has hit pension contributions hard, and economic uncertainty has forced many to divert their attention away from retirement planning and prioritising more immediate commitments.

However, reducing pension contributions now could cause retirement issues in the long run, he said, and the feeling of not having saved enough is already a source of stress for earners.

“It is vital that people establish a very clear retirement plan,” he added. 

“Calculations can be made to estimate how much, factoring in inflation, people will likely need to contribute to their pension each month if they are to achieve the retirement income they want; this is often a good starting point.”

Taking steps such as free guidance from Pension Wise or independent financial advice can help people better understand their financial situation, Eagling said.

“Comparing pension providers can also help individuals find the right pension for them. Taking these steps could help people better understand their financial situation and get on track to achieve a comfortable retirement.”

Last summer, Romi Savova, the chief executive of PensionBee, said the world has never been more uncertain for prospective retirees.