Only a quarter feel confident to retire

7th June 2022

Only a quarter of this year’s retirees feel very confident they have saved enough to retire – compared to nearly a third in 2021. The rising cost of living and the long-term impacts of the pandemic are key factors in the drop in confidence.

Today’s retirement comes with more choices than ever. From knowing how you’ll meet your day-to-day income needs to paying for later life care and passing inheritance to loved ones. A new survey by Abrdn has found the confidence in financial readiness to retire has fallen.

How much will you need?

Despite the State Pension increasing by 3.1% in April, inflation is currently surpassing 6% – meaning the value of the State Pension is also declining in real terms. That’s why beating the rising cost of living through clever decisions and professional support has never been more important!

Using the latest available data the full State Pension is £9,399 per year, the chart below shows how much extra an individual will need to meet the retirement lifestyles set out by the Pension and Lifetime Savings Association (PLSA) Retirement Living Standards.

Income needed for retirement

Advice from the recently retired…

Understanding what current retirees have found challenging can help you to prepare for what’s ahead. Before retiring, three stand out decisions surpassed all other things on their “to do list”:

Advice from the recently retired

Last year’s retirees faced a particularly challenging set of circumstances to navigate. However, a lack of confidence when approaching retirement and making big life decisions is not something new. It is this cloudy uncertainty that often brings many of our clients to their first financial planning meeting with Innes Reid.

The decision to retire is not one to be taken lightly. Significant thought and preparation are needed for this major transition. As Financial Advisers, it’s not only our responsibility to take on the burden of your finances but to instil a greater confidence as you approach retirement and as you evolve throughout.

Top 5 concerns of current retirees

On average 40% are spending more than they expected in retirement. With the main reasons being:

Spending more

Retirement is what you make of it.

We know many people are not even discussing retirement with loved ones, let alone seeking professional advice. Speaking to an Independent Financial Adviser can help set retirees up for a better retirement both financially and emotionally, and help you to feel more confident as a result.

Retirement is changing, some choose to set up a new business, others pursue working part-time or spend more time with grandchildren. Whatever your plans for retirement, it is what you make of it.

As Independent Financial Advisers it is our role to get you there with a plan that is robust, stress-tested and tailored to an ever-changing life. We can help to resolve your concerns about retirement and ensure you have financial security at the point of retirement and into the years that follow.