Eight year blind spot
UK adults have an average eight year blind spot when it comes to planning ahead – and can only see themselves in the future as far ahead as 2023, new research from long term savings and investment specialist Standard Life reveals.
The failure to be able to create a vision of our future is worse for around a third (33%) who can only see four years ahead – meaning that they can’t picture themselves or their financial needs for 2020 or beyond.
Not planning for retirement
And when it comes to retirement, around two thirds (71%) of working adults struggle to see themselves once they finish work – while a similar figure (68%) admit to worrying how they will cope financially in retirement, with one in six even doing so on a daily basis. A third of us (33%) expect to be worse off in retirement.
Despite these growing financial fears, the attitude of most appears to be ‘spend now, worry now’, with the average adult only financially planning for 2.8 years ahead, while one in four only have money measures in place for the next six months. A fifth (19%) of young adults are unable to envisage themselves more than a year in the future, which may explain why the average person doesn’t start a pension until they reach 31.
According to the research, the majority of us would like to see in our 60th celebrations without the worries of work – 59 was revealed to be the ideal age for retirement, yet 64 is the age most of us expect this will realistically happen. However, retirement is seen as no time to relax by some – one in ten (11%) plan to use this time to set up their own business.
However, with the biggest changes to the pensions sector in more than a century only weeks away, financial experts are predicting a change in attitude towards securing our financial futures.
Jamie Jenkins, Pensions Expert at Standard Life, said
The upcoming pension reforms provide a good opportunity for people to really think about and evaluate their future finances, and the options available to them.
‘However today’s research highlights that many people across the UK are struggling to plan ahead. Making any decision regarding your pension pot should not be taken lightly as it could have big consequences later down the line.
‘With this in mind, Standard Life has developed a range of online tools and guides to help get people thinking and planning for their retirement – all of which are available on our website.’
Jenni Trent-Hughes, social psychology expert adds: ‘This research demonstrates the fact that many have a real fear of facing up to long term financial matters. This is often linked to a fear that we are not going to be able to take care of ourselves and our families when our income generating capabilities decrease in later life.
‘But this is a mind-set which can be changed. It can seem like an insurmountable mountain to climb but like any other journey it has to be taken step by step. Changing your outlook will improve and strengthen your attitude. Taking small steps will eventually add up to the results needed to make your future financial situation seem more manageable and less scary.’
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