The current economic climate has sparked renewed debate in the UK over when is the right time to retire. The cost-of-living crisis is at the heart of the issue, with inflation currently sitting at 10.1%, prompting the Bank of England to make ten consecutive interest rate hikes to 4%. The sudden spike in inflation and interest rates over the past 12 months has significantly strained people’s savings.
And despite a slight easing in inflation entering 2023, prices are still climbing at a dramatic pace. Those nearing retirement are among the hardest hit, with My Pension Expert’s 2022 research revealing that 21% of workers aged 40 and above have delayed their planned retirement date because of the cost-of-living crisis.
Meanwhile, retirees in their 50s and 60s, particularly those who left work during the pandemic, are facing pressure from the government to return to employment. Chancellor Jeremy Hunt has made several comments of late encouraging Britons to ditch their retirement plans and play their part in boosting the economy.
This is not, however, a decision for the Chancellor to make. Every saver will have individual retirement goals that they deserve to see through. Therefore, it’s worth exploring these and identifying the challenges they need to overcome in order to achieve them.
What are Britons’ retirement aspirations and how has the economic climate impacted them?
My Pension Expert commissioned new, independent research to find out.
Working with Opinium, we conducted a fully nationally representative survey of 2,000 UK adults. The timely survey explored how financially prepared Britons currently are to give up work, what age they ideally want to retire at, when they think a realistic date might be, and how the cost-of-living crisis is influencing their dream retirement.
In this report, we share all the findings of our research, along with the thoughts of our CEO on pension engagement, thorough financial planning, and improving access to advice.
Among other key findings, the research found less than two in five (35%) UK adults in work think that they will be able to retire when they want to, with 55% saying the cost-of-living crisis has made retirement seem impossible. In addition, only 37% have a financial plan for retirement, while just 43% know how much is in their pension pot.
Despite these issues, 54% harbour dreams of travelling and seeing the world once they retire, and 71% dream of a long, comfortable retirement with time and money to pursue their interests, passions, and hobbies.
For anyone who is worried about their retirement strategy and how they might need to adapt their pension plans in light of the cost-of-living crisis, it is imperative they seek independent financial advice. An adviser can assess the entirety of their financial situation and tailor specific advice to help them live out their retirement aspirations.
And remember, My Pension Expert is always here to provide regulated advice and ongoing support, to give everyone peace of mind, whether they are approaching, or have already entered, their retirement years.
Get in touch with the friendly, experienced My Pension Expert team today.