Britons won’t have enough savings for retirement, report warns

A report by HSBC predicts that people in the UK will run out of savings after seven years of retirement

16:57 20 February 2013

Britain is being regarded as the worst place when it comes to saving money for retirement, a study has stated. It claims that on average, a Briton will run out of savings after only seven years of being retired.

We all hope to be able to retire by the time we reach 65-years-old, if not sooner, if we are fortunate to be financially secure, but the figures from the banking giant may come as a shock.

 

On average, Britons are expected to enjoy around two decades of retirement but these results claim that for the majority of this time - 12 years – it will be spent without savings.

 

HSBC’s Christine Foyster explained that a reason for this could be because life expectancy is higher these days, coupled with the fact that the UK has suffered economically in recent times. Although, the report reflects the warning that people should save for retirement if they hope to continue their current standard of living.

 

Joanne Segars, of the National Association of Pension Funds, commented on the situation.

 

“The UK needs to do more to face up to saving for its old age. For millions of people, that will mean working longer or saving more, or both. Too many people will retire only to find they have to significantly downgrade their lifestyle because they do not have enough savings,” she said.

 

“The UK is also in the midst of revamping its state pension to make it simpler and fairer,” she added.

 

"These changes will help our society retire on a more sustainable footing.”

 

There are different ways for people to prepare for retirement; some people choose to pay into a scheme, others make investments, although perhaps more people could follow their lead, based on the study.

 

Some Brits automatically pay into a retirement plan through their workplace. It is understood that there are plans for more workers to pay into a workplace pension scheme automatically in the future, according to reports.