New research has found that 89% of all new, working age clients did not realise how much money they would need in order to fulfil their own retirement ambitions before they began working with an independent financial adviser.
The research, conducted by deVere Group, surveyed more than 750 new and potential clients in the UK, the US, Australia, South Africa, Hong Kong, Spain, Qatar, France, Germany and the United Arab Emirates.
Of the findings, Nigel Green, founder and CEO of deVere Group commented: “It is very alarming indeed that nine out of ten workers are financially sleepwalking into their retirement.
“The poll concludes that the overwhelming majority simply do not know just how much they will need to save during their working lives to fund the retirement they desire. Not knowing how much they will need for something as important as funding their retirement is worrying.”
He continued: “It’s particularly concerning in this day and age because we’re all living longer meaning the money we save has to last longer. Also, because governments are unlikely to offer the same level of support as they have done for generations before due to an ageing population and shrinking work forces; because living, health and care costs will increase significantly; and because company pensions are less generous, if they exist at all.”
How much people need to be putting aside now, and in the years to come, in order to be able to enjoy the retirement they want for themselves and their families does vary from person to person, of course.
However, as Nigel Green observed, there is a consistent theme: “Before they have an initial meeting with an adviser, the vast majority of people underestimate how much they need to be putting aside for their retirement. This is the case across all incomes, working age brackets and nationalities.”
He adds: “People are typically shocked when it is revealed how much they should be saving now to realise their own retirement ambitions later on. They have usually considerably underestimated the money they will need.”
The deVere CEO concluded: “Despite the shocking poll, there are always methods to plan and maximise retirement savings at every stage of your working life.
“But it cannot be stressed enough that the earlier you start your retirement planning strategy, the easier the journey to hitting your goals will typically be. I would urge people to take their heads out of the sand and get informed.
“By putting in place a clear, workable plan, you’re laying the foundations to have a comfortable and financially secure retirement.”