Saving for retirement is something we all need to get into the habit of, but unfortunately, not everyone seems to be giving it the attention it needs. Research from The Share Centre has cautioned that many over-65s may not have enough saved for the comfortable retirement they're hoping for, so the question is, do you have enough saved?
According to the figures, the typical retiree thinks they'll need approximately £230,000 in savings to provide a comfortable retirement, but just 53% of over-65s think they have sufficient money saved to meet their needs. This perhaps explains why 54% want to continue working beyond retirement age, and given their savings goal, it's little wonder.
It's also unsurprising that 38% said that their biggest financial regret was not saving more when they were younger, which should provide a great incentive to younger savers – listen to some members of the older generation and start saving as much as you can! It may also be a good time to analyse how, and how much, you're saving, because you may not want to put all your eggs in one basket.
Saving into a workplace pension should be always at the top of the list of priorities, because that way, you're getting Government tax relief and contributions from your employer, too. But what about alternative savings vehicles? Figures from The Share Centre show that there's been a 16% increase in those aged 55+ holding ISAs since April this year, which demonstrates that "investors are exploring different savings options and taking an active approach", said Richard Stone, chief executive of The Share Centre.
Not only that, but the value of those accounts has risen by 27% over the same period, which further suggests that investors are looking to personally manage their investments to benefit for the long term. This could definitely be the way to go, particularly if you're hoping for a comfortable retirement – while most retirees think that they'll need a savings pot of £280,000, The Share Centre estimates that it'll have to be closer to £400,000 if you want an income of £20,000 per year, so you'll really need to start upping the savings levels if you want to achieve that kind of goal.
Cash ISAs are all well and good, but what about stocks & shares versions? They may be riskier – and are only suitable for those who are comfortable with that level of risk – but there's the potential to earn far higher returns, so they could be worth considering as part of a balanced savings portfolio. Above all, make sure to get suitable professional advice, and you may find you're able to build up a big enough pot after all.
Approaching retirement? Consider your income options with our annuity planner
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