Nearly one in eight workers think they will never be able to afford to retire fully due to the level of pension they will draw, according to a report from HSBC.
The Future of Retirement: Life after work?, which surveyed 16,000 people in 15 countries, shows that 12 per cent expected they would never be able to retire fully. In some countries, the figure was higher: 19 per cent in the UK and 18 per cent in the US. The survey also shows traditional retirement being eroded by economic pressures and longer life expectancy.
Among the retired, 38 per cent found their income was less than they had expected. Of these, one-third blamed the global financial crisis, while another third said they had not planned adequately. More than half said their outgoings since retiring were as high, or higher, than before, and on average, they expected their savings to run out.
Around 63 per cent of retired people worried that they did not have enough money to live on and 70 per cent regretted not having saved more.
Simon Williams, Group Head of Wealth Management, HSBC, said: “Generating an adequate income in retirement remains a major challenge for most people, given the financial conditions created by the global economic downturn. Today’s workers should prepare for retirement as early as possible to have some certainty. Life is full of reasons to prioritise short-term spending over long-term planning, but the sooner people start saving, the less they are likely to need to carry on working in retirement.”
A significant proportion of people surveyed said they were looking forward to working in later life. More than a quarter of people of working age said they intended to start a business in retirement and 44 per cent of those aged between 55-64 said that it was an aspiration to continue working.
The report identified four actions people could take to achieve a more comfortable retirement: taking family responsibilities into account; being realistic about likely costs in old age; not rushing to retire; and not relying on one source of retirement income.