More than one in four (28 per cent) UK adults don’t know how much income they will need in retirement, according to new research from Scottish Widows.
These figures, from its latest Retirement Report, show that this number remains high among older workers with 21 per cent of those aged 50 or over in this position.
The need for greater engagement is clear among those approaching retirement, as half of people in their 50s and early 60s have still not researched how much they might need to save.
Overall, the average annual income respondents thought they would need for a comfortable retirement stood at £29,000. Yet plotting this against Scottish Widows’ National Retirement Forecast suggests that just 43 per cent of people are on track to have this income in retirement.
The report found that only a third (34 per cent) of people think they are adequately preparing for retirement, with this figure increasing to 40 per cent amongst those aged 60-64.
When it comes to those approaching retirement, 54 per cent expect to retire after they would like and 64 per cent said they worry they will run out of money in retirement.
In total more than four in 10 (43 per cent) future retirees expect the State Pension to provide a modest or significant part of their income in retirement.
Scottish Widows said it is therefore not surprising that 45 per cent of those polled are concerned about changes to the State Pension, with more than one in 10 (12 per cent) of future retirees concerned that it will no longer be around when they come to retire.
Scottish Widows head of pension policy Peter Glancy says: “Expectation versus reality when it comes to retirement income shows how vital it is to help people – especially those on the verge of retirement – build a clearer picture of what their own lives could look like when they stop working, and what they can do now to achieve the best outcomes.
“There are lots of tools available to help people get to grips with pension basics and work out the right steps to take to boost their retirement income, and the earlier we start thinking about our pensions as part of our everyday finances, the more we can do to close that gap.”
