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Over 50s expect to retire aged 65 and live to 82½
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They feel they need around £1,487 monthly household retirement income
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47% expect to work part-time, 21% plan to volunteer, 5% don’t expect to stop full time work
According to the first in a series of Retirement Sentiment Index reports, certainty ranked as the top priority for 43% of over 50s when thinking about income in retirement, followed closely by flexibility (33%). Being able to grow income or having instant access to funds ranked far lower as priorities, with only 10% and 14% respectively saying these were their top priority. The findings point to an emerging hierarchy of retirement finance needs.
Andrew Tully, pensions technical director at Retirement Advantage, said: ‘We asked people straight out what they would value most from their retirement savings, and certainty is their top priority. April’s reforms were supposed to herald the beginning of the end for annuities, with freedom the new order of the day. While the reforms put a lot more options on the menu for retirees, guaranteed income is still the most popular dish. Flexibility and freedom of choice are important, but certainty is still what most people want most of the time.’
The research, carried out in two waves by YouGov starting in May this year, also found that the over 50s are anticipating a 17-year retirement, expecting to retire at 65 and live to 82. The most important aspects for retirement finance are the ability to pay bills (67%), go on holidays (60%), start new hobbies (38%) and pay for long term care requirements (24%)1.
Andrew Tully added: ‘It’s difficult enough to plan for a year in the future, let alone plan effectively on day one for potentially decades of retirement. People want to know they will be able to cover life’s essentials and still have the flexibility to enjoy life and deal with the unexpected. The challenge facing the retirement industry is to develop products that reflect this new environment. We have to juggle these competing demands, providing the right amount of certainty and the necessary flexibility to help people lead the life they want to live.’
A full copy of Certainty - the first report from Retirement Advantage’s Retirement Sentiment Index – is available below:
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