Over 65s warned of major ‘pension’ risk – 5 year warning | Personal Finance | Finance

A major UK building society has warned older savers that what many of them believe would be enough to support their retirement wouldn’t cover four or five years of living at a “moderate” level. Skipton Building Society (SBS) carried research alongside OnePoll with 2,000 working adults which found that 38% have barely given retirement a moment’s thought, with many adults at risk of having to work past their planned retirement date due to inadequate pension pots.

That comes despite growing evidence a lack of planning is forcing older people to push back leaving work, it added. According to the financial institution, though complacency is highest among younger adults, with 61% of Gen Z saying they haven’t seriously considered retirement, more than one in ten, (17%) of those aged 65 and above have admit the same. SBS said the findings suggest that staying in work later in life is becoming less of a lifestyle choice and more of a financial necessity.

Those 65 and over recorded the lowest planned retirement fund, with nearly one in seven (14%) believing under £100k would fund their dream retirement, despite 18% hoping to travel the world.

Separate analysis by Skipton found that even when combined with the State Pension, a £100,000 pension pot would only cover around four to five years of retirement for a person living at a moderate level, as defined by the Retirement Living Standards.

Meanwhile, despite 17% of over 65s having no idea how much they currently put into their pensions each month, over a third of this age group (39%) are worried about running out of funds, their research with OnePoll found.

At the same, the average Gen-Z expect to need a much larger retirement fund. 11% expect to need between £1m-£1.09m.

But despite these big ambitions for later life, an even larger proportion don’t have idea how much they currently contribute each month (33%).

The polling also found that 33% of respondents simply believe they won’t need as much money as they get older, despite costs continuing to rise.

Helen McGinty, head of financial advice distribution at SBS said: “With many not knowing how much they’re contributing each month to their pension, yet worried about not having enough money, it’s time to wake up to the reality that those dreams won’t happen without planned and considered action.

“The earlier you start planning, the more options and flexibility you’ll have later on. It’s also important to think carefully about how your retirement savings will support you throughout your lifetime, especially as health and lifestyle needs change.

“Having a trusted place to turn for guidance can make all the difference — and at Skipton, members can access free money guidance alongside regulated financial advice to help them take small, informed steps today that shape a more confident future.”