June 15th, 2005 1 Comment » | POSTED BY ROB
Huge Shortfall In Young Pension Savings
In a follow-up to my previous post about Young Workers Failing To Take Pensions, there have been a couple of interesting reports released today about the lack of retirement saving amongst the young generations:
A report by Birmingham Midshires showed that those under the age of 30 saved an average of £792 in the first 3 months of this year (that actually sounds quite high based on my experience!). Whilst this is up on what it has been in the past, only £167 of the saving went on a pension. It also finds that over half of those surveyed saved an average of £226 per month in those months (again, this sounds rather high).
More worryingly, the other report by the Prudential highlights the shortfall between the figures suggested above and what we need to say in order to enjoy a comfortable retirement.
In the two scenarios it shows, a 20-year old saving at current average rates would have to work until the age of 72 (at average lifetime earnings) in order to retire on 2/3 pre-retirement income. Similarly, if a 30-year old wishes to retire at 65, they should be putting away a staggering £340 more a month on average!
- How Much Do You Need For A Comfortable Retirement? (July 22, 2007)
- Average Retirement Age Rising (October 23, 2008)
- £1million Needed To Retire Comfortable (June 20, 2006)
- Considering Stopping Your Pension? It Could Cost You £30,000 (November 17, 2008)
- Pension Reform Report Released (November 30, 2005)