Page 38 - DIY Investor Magazine | Issue 39
P. 38

  Nov 2023 38
DIY Investor Magazine ·
HOW MUCH HAS EVERYONE ELSE GOT IN A PENSION?
Holly McKay and her fine team at Boring
If these figures seem worryingly modest, the survey also found that more than 3 in 10 of those self-employed have made no Money recently published their annual
pension provision; usual rules apply – you can only start from pensions survey, delivering a snapshot
of what people are up to when it comes
where you are, and little and often is better than nothing and never – and there are plenty of platforms such as Penfold to
to providing for their retirement – by
help you along.
Hannah Barnaby
 There is no question that the series of black swan events that started with the Global Financial Crisis, took in the global pandemic, and landed in the massive geopolitical upheaval we see today – with attendant cost of living and energy crises – focused the mind of a very large number of new investors.
We regularly hear that for many, the feeling of being in control of their finances when surrounded with so much uncertainty, gives them the most comfort.
With Millennials widely expected to be the first generation to be poorer than their parents, saving for retirement will be just one key financial objective, as they wrestle with student finance, the sky-high cost of accommodation, and uncertainty around state provision of universal health care and pensions.
But whereas 401k/591⁄2 conversations are staples around US dinner tables, money can still be a taboo on this side of the Pond; so Boring Money went right ahead, and asked the question, that actually everyone really wants to know – how much has everyone else got in a pension?
And here’s the answer based on pensions from people’s work and private pensions, and excluding the State Pension:
• Aged 25 – 34? In total (and mostly from your workplace pension), the average pension savings stash is £18,000. And nearly 3 in 10 of you have at least 2 pensions.
• 35-44? The average combined pensions total is £37,000 and 33% of you have multiple pensions.
45-54? You have £77,500 amassed and over 4 in 10 of you have multiple pensions.
• 55+ and not yet retired? The average war chest is £101,500 and 44% of you have 2 or more pensions.
WHAT DOES THIS ALL MEAN?
As a rule of thumb, dividing your total pensions savings by 20, gives a rough idea of your annual retirement income; £100,000 in total, could deliver an income of £5,000 a year when you retire - £15,600 if you add the full State Pension.
The survey elicited plenty of stories around retirement, and found that many were pushed into it by work, Covid changes, questionable employer attitudes towards older people, and health issues. For many, it’s all about the money if full retirement isn’t yet an option.
For the under 45s, retirement doesn’t seem to mean much; many think they’ll keep on working into their 70s and possibly beyond. Interestingly they are twice as likely as other generations to see themselves caring for grand-children or a partner.
It certainly feels like it’s time to dispense with the glossy brochures of sun-kissed pensioners on cruise ships and work on improving financial literacy and engagement to empower people to make informed decisions when investing for their golden years.
Take control of your financial future:
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