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Worry over retirement finances

Worry over retirement finances

Category: Pensions

Updated: 04/01/2010
First Published: 23/11/2009

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.
Over a third of UK consumers believe their retirement savings have been partly eroded by the economic downturn, forcing people to look at supplementing their savings.

Research conducted by Aviva has revealed 35 per cent of people with a retirement fund think that the recession has had an adverse effect on their savings. Twenty three per cent said they have had to cut their outgoings to enable them to save enough for their retirement over the last 12 months.

A further 12 per cent said they had been forced to look at additional sources of income to boost their retirement pot.

The figures reflect a wider concern amongst people about their financial situations. Over a quarter professed to worrying about how they will make ends meet in the future, while 19 per cent said the falling value of their pension income was their main concern.

Almost one in three (32 per cent) said the rising cost of living was their most pressing financial problem.

"Understandably, the recession has forced people to think about their retirement income and many have realised that they may not have sufficient funds to live through their final years in the comfort they have grown accustomed to," commented Brian Bussell, director of pensions, UK Life, Aviva.

"We would encourage people to make use of their full range of assets, including investments, state benefits, pensions and property, to make sure that they aren't effectively cheating themselves out of the lifestyle they could enjoy."

"We would also urge people to begin saving as early as possible for their retirement to make sure they do not have to make major lifestyle changes later in life."

A separate study by AXA has found that almost a fifth of 18-24 year olds are delaying starting to build up a pension pot simply because they do not like the word pension.

It is estimated that by delaying starting a pension for just five years, this group of around one million young adults could facer a retirement shortfall of some £44.1 billion – equivalent to just over £44,350 per person.

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