Almost two-thirds of over 60s to rely on state pension - Kreston Reeves

Just under two-thirds (64 per cent) of over 60s expect to rely on the state pension to fund their retirement, according to a study by Kreston Reeves.

The research, which was part of the firm’s Planning for your future: Financial clarity in an uncertain world report, surveyed people over the age of 35 and found that, comparatively, just a third (33 per cent) of individuals aged between 35 and 59 stating that they would rely on their state pension.

These younger generations were also slightly more confident at meeting their retirement goals, with 36 per cent of the younger group and 32 per cent of the over 60s believing that they would have ‘just enough’ funds in retirement to meet their plans.

Almost a third (30 per cent) of over 60s were found to have never taken financial advice, along with around a quarter (24 per cent) of 35 to 59-year olds.

Individuals between 35-59 were found to be more likely than their older counterparts to draw upon a wide range of investments to fund their retirement, including savings, personal investments, property, and inheritance.

Kreston Reeves solicitor and director of legal services, Sarah Mannooch, commented: “We all need to consider and understand the financial future we want and need, and that must extend beyond pensions and investments.

"Our survey suggests that people believe the state will provide the level of financial and care support we need, but that is increasingly unlikely.

“It is important that we start to consider our long-term financial futures as early as possible to ensure the widest range of options are open, and we hope this report will help start those discussions.”

Kreston Reeves partner and head of tax, Daniel Grainge, added: “Our survey points to an over-reliance on the state pension across all ages, which is concerning given that we can expect it to become less valuable over time and accessed at a much later age.

“Those aged between 35-59 are more likely to draw upon a wider and often complex pool of assets, and in an uncertain world, the need to regularly review finances, take independent advice and plan ahead has never been more important.”

The firm’s research also found that more than half (54 per cent) of respondents described their attitude to risk as cautious.

Furthermore, whilst the pandemic left investor attitudes to risk unchanged in the over 60s age group, over a third (37 per cent) of those between 35-59 stated that they had adopted a more defensive approach.

Grainge said: “The fragility of the global economy due to Covid-19 and stock market volatility is threatening our respondents’ long-term financial future and security.

“With the range of threats highlighted in our survey it is worrying that such a large proportion tell us that they have never taken financial advice, compounded further by the belief that they are confident that their financial affairs are in order.”

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