It seems that the aspiration of a work-free life in old age is just a pipe dream for many Brits, as new research from Mintel on retirement planning in the UK four in 10 (39%) working Brits don’t think they will ever fully retire.

Mintel research indicates that there is little optimism surrounding retirement, and for many the situation is negative enough to call the very concept of retirement into question. In fact, today, Brits who aren’t retired are more likely to agree that they will never fully retire (39%) as compared to those who believe they will retire (35%). Those most likely to have resigned themselves to a life of work are aged 18-34 (42%), in comparison to around one in three (36%) of those aged over 54 who say they will never fully retire.

Regionally, there are also vast differences in the proportion of consumers who do not believe they will fully retire. A staggering 45% of working consumers living in London cannot imagine a work-free future; however just one third (32%) of Scottish consumers say the same.

But while many Brits see no end to a working life, it seems some have their eyes firmly fixed on their ‘golden years’. One third (32%) of Brits who are not yet retired say they plan to do so as soon as they can claim the state pension, peaking at 42% of men aged 25-44.

And while the decision of whether and when to retire is split between different age groups, so too is the vision of retirement. Overall, some 61% of non-retirees think that their generation will not have as comfortable a retirement as previous ones, rising to 65% of Generation X (defined by Mintel as those born between 1965 and 1979).

Rich Shepherd, Senior Financial Services Analyst at Mintel said:

Too many people have a negative view of retirement, with many expecting their generation’s retirement to be less comfortable than both those who came before and those to follow. Rising state pension ages and the struggle to save adequate funds for retirement make it easy for consumers to compare their prospective retirement with previous generations and see that they will have to work longer and receive a less comfortable pension. For some, the situation is negative enough to call the very concept of retirement into question.”

Perhaps explaining the low number of consumers opting for retirement, when it comes to pension ownership, Mintel research shows only a minority of Brits own a plan. In terms of saving and investment product ownership, 42% of non-retirees say that they hold some form of pension, up from 38% in 2015. However, Mintel research also reveals there has been a four percentage point increase in defined contribution workplace pension ownership up from 8% in 2015 to 12% in 2016. This has contributed to an increase in ownership of all workplace pensions in the last year, up from 28% in 2015 to 36% in 2016.

Despite an increase in pension ownership there remain significant gaps in ownership between demographics. While over half (55%) of full-time employees and 42% of men report having any type of pension, this falls to 35% of part-time workers, 17% of self-employed individuals, and 31% of women.

Away from pensions, one fifth (20%) of non-retired consumers expect to use funds from their Cash ISA to help fund retirement, while one third (33%) expect to use money from a savings account.

“The success of the auto-enrolment scheme in providing pension provisions for millions who previously had none, is perhaps the biggest good news story seen in the financial services industry in recent times. However, there remain significant gaps in ownership between demographics, which must be addressed. It should be a priority to encourage everyone to save as much as possible in a pension. This means specifically targeting groups falling short such as women, part-time workers and self-employed individuals.” Rich continues.

While many argue that paying in minimum contributions to a workplace pension will not be enough to provide a comfortable standard of living in old age, Mintel research reveals that workplace pension holders are almost twice as likely to make minimum pension contributions (48%) as to voluntarily increase their contributions (25%). And while 57% of non-retirees are concerned about saving enough for retirement, only 29% say that planning for retirement is a priority for them at the moment, compared to 55% who say that it isn’t. Today, just 30% of Brits who aren’t yet retired expect to receive a comfortable income when they retire.

“Increasing the amount that consumers save in their pension will be a priority for providers and the Government over the next two to three years. While there is an awareness among consumers that they should contribute more, relatively few do anything about it. More could be done to help consumers bridge the gap between knowing that they should save more, wanting to save more, and actually saving more.” Rich concludes.

Press copies of Mintel’s Retirement Planning in the UK report and interviews with Rich Shepherd, Senior Financial Services Analyst, are available on request from the press office.

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