As Pension Awareness Week comes to a close, research from Legal & General reveals nearly half (41%) of retired people have belatedly realised they need more money than they anticipated to enjoy their retirement, shining a light on the significance of financial literacy in the workplace.
Amidst a turbulent financial landscape and the rising cost-of-living – the results reveal one in five retirees found they needed ‘significantly more’ money than anticipated, while 94 per cent said their ultimate dream for retirement was to achieve lasting financial security.
The survey of over 2000 individuals aged 50+ aimed to understand the expectations and realities of retirement in the UK, revealing a rather nuanced relationship between retirement expectations, financial stability, and the actual experiences of retirees.
Please see the key data below:
• Financial security the key priority: 94% of respondents revealed that their ultimate retirement dream is to achieve lasting financial security throughout their golden years.
• Gaps between dreams and reality: While many retirees reported fulfilling their retirement aspirations, almost half (47%) of UK retirees say their retirement income has not been used as they intended.
• The average pension pot balance at retirement is just over £185,000. However, disparities are prominent with 16% retiring without any pension savings and 12% accumulating over £500,000.
• Over a third (31%) of respondents did not seek any financial advice when planning for retirement.
The survey reveals that financial preparation plays a pivotal role in shaping retirement outcomes. HR leaders have the ability to empower their colleagues to proactively plan for their ideal retirement. To address these disparities and help employees achieve their retirement dreams, HR managers can play a crucial role by offering comprehensive financial literacy programs and encouraging employees to seek expert financial advice when planning for retirement.
Lorna Shah, Managing Director, Legal & General Retail Retirement says “there’s a lot you can do to help you live your ideal retirement when you finally get there. Start by imagining it! Sketch out your later life hopes and dreams. Then you can see if you’re saving enough and making the right pension pot choices to support them, and take action if you’re not.
“Of course, in our tough financial times that probably won’t be as easy as it sounds. But even if all that planning’s a bit stressful and confusing, our research shows that it will be well worth doing. Looking at your financial situation, setting later life goals and getting advice on the best way of achieving them are key steps toward a happy retirement.
“So whether you’re looking to spend more time with loved ones, travel the world or just keep up your current lifestyle, our advice is the same: Plan ahead and you can do it.”
For more information, please see here: https://www.legalandgeneral.com/retirement/rewirement/retirement-realities/
Legal & General has also developed a Pension Annuity Calculator that can assist individuals in planning their retirement income. The calculator is a valuable tool to assess how their pension pot might provide for their retirement, offering tailored insights to suit individual circumstances. Please see the calculator here: https://www.legalandgeneral.com/retirement/pension-annuity/pension-annuity-calculator/