Do Young Brits Have a Plan for Retirement?
When it comes to saving for retirement, Brits aged 35-54 are caught between a rock and hard place. They’re too young to have benefitted from defined benefit pensions, but may be enrolled into auto-enrolment, which usually happens mid-career.
This has led them into what’s called “the squeezed generation” when it comes to how much they have managed to put aside for when they retire.
With nearly half of UK workers unaware that their occupational pension will provide them with an income in retirement, now is the time for everyone to plan better.
What does the research say?
Research shows there are three main barriers the age group faces when saving for later life:
- The majority have more pressing financial priorities than contributing to their pension.
- Some respondents found retirement planning overwhelming, saying that the current economic crisis has made them less confident about their ability to plan for the future.
- The majority of people felt their retirement planning was on track. There are many reasons for this, including the fact that more than one in three people have no idea what they can do to prepare for life after work, they do not know where they can find information about their pensions, and are not aware of online pension calculators, or haven’t yet spoken to a free government pension service or financial adviser.
Communication is Key
The feeling of regret can become a sense of defeat. The limits placed on ourselves by our current circumstances may cause us to put off improving the way we finance and prepare for later life until it’s almost too late.
When we talk about retirement, people are often unsure of what to do and how they will manage their money. It can be difficult for some individuals who lack confidence in this area because it seems overwhelming at first glance – but now there’s new research that might help! This study investigated whether alternative choices of language or message framing would motivate more people to take the first steps towards being hands-on with managing cash flow once again. Surprisingly enough, most people found these approaches very effective when combined with a method of communication-based on empathy and reassurance.
It’s widely considered that effective communication is one of the largest barriers when engaging with clients. The level of change in people’s stated intentions after seeing the optimised messages was quite striking.
These findings support the conclusion that communication using these foundational messages can positively impact retirement planning and preparation among mid-working lifesavers, thus helping more people achieve financial security at the end of their working lives.
How do I start?
It is never too late to start saving for retirement. There is always something that can be done to get you on the path to achieving your financial goals. At SJB, we help you make the most out of what you have to work with.
Enquire through our website today to receive a 15-minute free consultation to find out if our service is the right fit for you.
Research citation: https://www.invesco.com/uk/en/nest-insight-research/small-steps.html
This communication is for informational purposes only based on our understanding of current legislation and practices which are subject to change and are not intended to constitute, and should not be construed as, investment advice, investment recommendations or investment research. You should seek advice from a professional adviser before embarking on any financial planning activity. Whilst every effort has been made to ensure the information contained in this communication is correct, we are not responsible for any errors or omissions.
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