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Twenty-somethings reveal pension plans

Twenty-somethings reveal pension plans

Category: Pensions

Updated: 16/12/2009
First Published: 16/12/2009

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

Signs that a more financially responsible Britain has been created by the recession are appearing after it was revealed that paying off debt had become the biggest priority of the younger generation.

Almost a third (31%) of 21-29 year olds are now prioritising paying off debt over saving for a house (25%) or funding a career break (11%), according to Friends Provident.

Meanwhile, the message that people need to start saving for retirement also appears to be sinking in, with nearly half (44%) of those in this age bracket already paying into a company pension.

Over a third (35%) claimed their intention is to start contributing to a pension before they hit 30.

Furthermore the research revealed 21-29 year olds plan to use additional saving vehicles for their retirement, including ISAs (43%) and investment (equity) portfolios (35%).

The increasing focus on taking personal control of their retirement planning appears to have arisen from a lack of confidence in the state pension system.

Over half (58%) of twenty-somethings disagreed that the state pension would be enough to support them by the time they retire, compared with 14% who thought it would be adequate.

"In the current economic environment it is very uplifting to see that the younger generations are taking financial matters into their own hands," said James Ward, director of UK Corporate.

"With the Chancellor's Pre Budget Report adding yet another unwelcome layer of complexity to pensions in the UK, we need to continue to highlight the benefits of saving.

"It is encouraging to see some of that message is being understood and younger generations are grasping the nettle and getting their finances in order."

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