People in their 50s are being urged to review their retirement savings now. UK households are being told to make a crucial pension check before time runs out.
Retirement Living Standards Report
Pension UK's updated Retirement Living Standards (RLS) report reveals that fewer than a quarter of people are expected to enjoy a moderate standard of living in retirement.
Zoe Alexander, executive director of policy and advocacy at Pensions UK, said: "The latest update to the Retirement Living Standards underlines a clear reality for many people, today's saving levels will not be enough for the retirement they expect. It is expected that around 82% of people reaching a minimum standard of living, but far fewer will go beyond that.
"That is out of step with what people expect for their future. Without action, too many risk facing a cliff-edge drop in income when they stop work."
Government and Employer Role
The Government is right to be considering whether minimum contributions need to rise through the work of the Pensions Commission. Alexander added: "In the meantime, tools like the RLS play a crucial role by helping people take control and understand what they might need, so they can put more money away where and when they can.
"We also encourage people to speak to their employer and see whether the organisation is prepared to support them to save above the minimum, such as higher rates of matching pension contributions. This could help 'bridge the gap' until policy catches up and we see higher savings levels set in legislation."
Financial Advisors' Advice
Gosia Dawson, director at Glade Financial, said: "If you're in your 50s, now is the time to confront the numbers. Understand what income your pensions could realistically provide, identify any shortfall and take action while you still have earning power on your side."
Anita Wright, chartered financial planner at Ribble Wealth Management, said: "In your 50s, time is shorter, not gone. Strip out the costs you won't miss and redirect that money. Clear expensive debt before it compounds against you."
