Retirement Planning: Your New Year’s Resolution for 2017?

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It turns out I’m not the only one with pensions on the brain – or am I? A new study has found that almost half the UK population has an “ostrich mentality” when it comes to saving for the future.

The Skipton Building Society Retirement Tracker, which monitors the retirement savings behaviours of more than 6,000 people up and down the country, has revealed that 48% of us have our heads in the sand when it comes to the dreaded ‘P’ word (pensions), with retirement savings that are either meagre or non-existent.

Skipton Building Society asked me to team up with them to help raise awareness of the dire state of the nation’s retirement savings, and this is a campaign of which I am proud to be a part. Heck, I’ll shout from the rooftops about it! As regular readers will know, retirement is a subject close to my heart: I am currently taking (somewhat overdue) steps to boost my own pension pot.

I must admit, that 48% statistic made me gulp. With no private pension plan and no savings, that is a lot of Ostriches who, if their savings behaviours do not change, will be throwing themselves upon the mercy of the State Pension when they reach retirement. As I have written previously, this is a dangerous game: not only is the State Pension modest but, as hundreds of thousands of women born in the 1950s have discovered to their horror, governments can move the goalposts and change the eligibility criteria according to their whims.

What saver are you?

The Ostriches are one of five groups of retirement savers identified by the Skipton Building Society Retirement Tracker. The crème de la crème are the Wise Owls.  Members of this group tend to have a “more sophisticated portfolio with a broad range of investments and savings.” Nearly half (47%) are saving to fund retirement through a Cash ISA, more than a third (37%) through a personal pension and almost a third (32%) through investments in stocks and shares.

Are you a Wise Owl? The five groups of retirement savers break down as follows:

 

Ostrich Mentality (48% of the sample)

·         Not saving for retirement or their savings are falling short

·         The majority have nothing saved to supplement the State Pension

 

Savings Snails (18% of the sample)

·         Saving the minimum they can afford

·         More than a third (35%) believe their retirement savings will be less than they need by the time they retire

·         At the same time, they have no set target for retirement savings

·         The majority have nothing saved to supplement the State Pension

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