A third of Brits feeling less positive about retirement than a year ago

A third (33 per cent) of British people feel less positive about their retirement outlook in 2023 than they did in 2022, research from PensionBee has found.

It revealed that 34 per cent of those aged over 55 felt less positive than last year about their retirement, while 32 per cent of those under 55 felt worse about their retirement prospects.

Less than a fifth (19 per cent) of under-55s and 15 per cent of over-55s were more positive than last year.

More than half (51 per cent) of under-55s felt negative about their pension outlook, compared with 42 per cent saying they felt positive, while 50 per cent of over-55s were negative and 45 per cent were positive about their retirement prospects.

The top reasons for feeling negative amongst under-55s were: ‘I’m worried that my costs will be high in retirement’ (29 per cent); ‘I can’t afford to contribute enough’ (28 per cent) and ‘I think my pension pot is small’ (28 per cent).

Meanwhile, for over-55s, the top reasons for being down on their retirement outlook were: ‘I am worried about the effects of inflation on my living standards’ (26 per cent); ‘I wish I had saved more for retirement’ (23 per cent); and ‘I don’t trust the government to maintain a decent state pension’ (22 per cent).

Entitlement to the full state pension was the top reason over-55s felt positive, with 39 per cent citing this as a reason, while 14 per cent said it was because they were on track for a moderate retirement and 13 per cent stated they were already enjoying a moderate retirement.

For under-55s, good employer contributions were the top reason for feeling positive (29 per cent), followed by good personal contributions (20 per cent) and confidence in the state pension (19 per cent).

Looking at narrower age cohorts, PensionBee found that 58 per cent of 18-24 year olds were positive about their retirement outlook, but this falls sharply from the age of 25, with 21 per cent of 25-54 year olds feeling ‘very negative’ about their pension outlook in 2023.

PensionBee noted that male savers were more likely to feel ‘very positive’ than female savers, at 19 per cent and 8 per cent respectively.

Meanwhile, women at or near retirement were more likely to hold ‘very negative’ feelings about their pensions than men of the same age, at 21 per cent and 15 per cent respectively.

“Britain lacks pension confidence,” commented PensionBee director (VP) public affairs, Becky O’Connor.

“Concerns about not being able to afford to save and the insufficiency of existing pension provisions to meet living costs for those already in retirement are behind a generally negative mood among Brits about their long-term finances, with renters and the self-employed feeling the most gloomy about their pensions outlook.

“Employers and the government have key roles to play in promoting confidence, by offering good contributions to workplace pensions and by maintaining state support for retirement in the form of a decent state pension.

“The state pension emerged as a key cause of a lack of confidence in people’s retirement outlook - it’s clear that anything the government does to change the state pension, whether that’s reforming the triple lock or increasing the entitlement age, could have a big impact on people’s confidence in the future.

“The good news is some people are planning to take action in the next 12 months - checking their state pension entitlement, increasing contributions for those still working and minimising tax for those in retirement.”

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