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More than half (64%) of workers aged 45 and over do not know how much they will need to save to afford a comfortable retirement, research by Aviva UK has found.
With the full new state pension currently valued at £168.80 per week, which adds up to a retirement income of £8,777.60 per year, it is important for workers to know how much they will need to personally save in order to supplement their state pension and enjoy a comfortable retirement.
Along with knowing how much they need to save, employees also need to know how much they have saved already, however Aviva UK’s research also found that 37% of employees have no idea of how much they have already saved for their pension. In addition to this, the research found that 26% do not know at what age they’ll be eligible for the state pension.
Lindsey Rix, managing director of savings and retirement at Aviva, said: “Millions of mid-life employees are flying blind, and fast, towards their retirement. At the same time, these employees are calling upon their employers for help.
“Without a clear picture of what they currently have saved or might need to save for a comfortable retirement, our findings show many UK employees are approaching retirement with their eyes closed – with no realistic idea of how near or far they are from their destination.
“As a first step, mid-life employees who are mystified by their pension savings should try to get a clear picture of what they have saved so far and how much of an income this can provide them with over the course of retirement. For some, this may be a pleasant surprise, while for others, it could be the wake-up call that’s needed to spur them to take action. People whose pensions are in need of a boost shouldn’t be disheartened, however, as it’s never too late to save.”
While it is better to start saving for retirement as early as possible, even at the age of 40 it isn’t too late to start a pension fund. Our guide – starting a pension at 40? – explains what workers need to know about saving for their retirement in their 40s.
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