A study of 2,000 working adults has been commissioned by Timeline to find out how many have set the wheels in motion for retirement. The research uncovers just how they hope to enjoy retirement sooner rather than later - and how much money they will need to live comfortably.
And while the findings show large numbers have started planning for the future, they also reveal how many haven't done any forward thinking at all - with large numbers fearing early retirement is way out of reach.
think early retirement is a realistic goal
of working adults ‘fear’ they will never be able to retire
have made or intend to make plans to retire early
only 27% have sought advice from a financial adviser
is the amount those who wish to retire early think they will need to do so. This includes state pension, any other pensions they may have, and personal savings.
Nearly three in 10 believe early retirement is a realistic goal, however many are not preparing for the future by putting money aside. Those youngest are least likely to be setting aside money to help make early retirement possible with just 41% putting money aside. This compares to 92% of 65 and overs.
A greater proportion of men (73%) are putting money aside on a regular basis to make early retirement more likely than women (54%). Both males and females believe they will retire at 60 years of age. Men are also more likely to make plans to retire early - 41% in contrast to 30% of women.
On average, those polled believe £383,133.87 is the amount of money they need to comfortably retire early. This figure includes state pension contributions, any other pensions they may have, and personal savings.
In pursuit of this golden figure, 62% are putting money aside regularly - and those who are saving £710.86 a month on average.
While reading this might cause a sense of panic among those who aren’t currently saving money - 55% believe it’s already too late for them to make plans to retire early - there could yet be time for you to retire early or make retirement more comfortably.
Read on for more insights into how.
The research initiated by Timeline suggests there are two clear camps - those who have their eye on the prize when it comes to retiring early, and those you can’t bear to think about the prize, let alone look at it. And unless you’ve swotted up on retirement plans and things likes pensions and national insurance contributions - or had someone explain it all to you - this topic is likely to be very confusing indeed.
But if you’re among the many adults who find it all very baffling and perhaps even boring, you’re not alone. Around a fifth have no idea if they contribute more than the standard pension contribution amount each month. And six in 10 aren’t sure what the minimum workplace pension contribution is.However, if you’ve read this far you probably realise being on top of your pension payments is extremely beneficial. It’s estimated there is £20 billion in lost pensions in the UK - from pension contributions received or made in past jobs which were not transferred to new jobs.
have no idea if they contribute more than the standard pension contribution amount each month
aren’t sure what the minimum workplace pension contribution is
are yet to check to see if they have any missing pensions
If this includes you, it would be worth investigating further because your finances could be in better shape for retirement than you’d thought.
Three in 10 are quietly confident early retirement early is possible, but what steps have they taken -or intend to take - to achieve this goal?
Investing their money
Keeping track of spending
Paying off debts
Making overpayments on their mortgage
Taking out an ISA
Secure a revenue stream for retirement
Reduce direct debits
Seek out financial advice
Buy premium bonds
Most working adults - 52% - haven’t given much thought - if any - about putting money for they retire, although they admit they probably should. And as we’ve touched upon already, just 33% have made plans for retirement - or intend to - so the actual number of those who actually have is likely to be even lower. Many are confused or even intimidated by retirement planning. Despite this many of those who have made a concerted effort to come up with a strategy for giving up work sooner rather than later appear to be doing so alone.
have sought counsel from a financial adviser about their retirement plan
don’t know how to find out information such as knowing what their total National Insurance contributions amount is
have no idea how to check their state pension contributions
Of those with a retirement plan, just 27% have sought counsel from a financial adviser about their retirement plan – only 9% of everyone polled. Advice from such an expert could not only help with such things as knowing what their total National Insurance contributions amount to – information 49 per cent don’t know how to find out - but also give you access to retirement planning software such as Timeline. They could also help you check your state pension contributions – again, a figure 46% said have no idea how to get.
haven’t given much thought - if any - about putting money for they retire