The true significance of saving really comes through when one has retired and reached an age where life has to be lived out of a piggy bank. However, about more than two-third people seemed to have failed to understand the importance of savings as the online survey conducted among 2,000 adults, for the insurer Friends Provident by YouGov revealed that those many would have to endure tough times after retirement as they had not put aside anything for life in old age.
The research clearly stated that two-thirds would be unable to carry on with their present or desired lifestyles at an older age since they had no savings at all. Moreover, 68% people apparently confessed that life after retirement would not be too smooth as most of them fetched about £10,000 less per year, than what they assumed was needed. In spite of people being cognizant of the fact that their pensions were at a deficit, 27% were still found saving zilch, according to insurer Friends Provident.
As regards the reasons for the plummeting savings for retirement, people attributed their inability to save to their financial obligations and priorities like mortgages and credit card repayments. For about 54%, mortgage repayments absorbed a sizeable amount of their outgoing expenses, whereas 48% were found splurging on their children. Another 41% were tied down with large credit card and sundry debt payments that made them incapable to put aside anything. Subsequently, more than 50% of those who had no savings also had insufficient cash to fund a pension.
Meanwhile, there were quite a few people who admitted that they preferred spending on holidays and car and home enhancements as compared to saving for pensions. A meagre 12% were found to save adequately to meet their pension requirements. Examining the zero saving situation, Jeremy Ward, head of pensions marketing for Friends Provident advised people, saying that, "These findings are a wake-up call to warn people to start putting enough money into a pension, sooner rather than later, in order to enjoy a more financially secure retirement."
Posted
on : Wed, 20 Apr 2005 00:00 GMT | Pensions News
By : Anne Philips
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