Self-employed see property as safest way to save for retirement

Self-employed workers see property as the safest way to save for their retirement, Office for National Statistics (ONS) data has revealed.

According to the ONS, 38 per cent of self-employed workers see property as the safest way to build up savings for when they retire.

Less than a fifth (19 per cent) believe that workplace pensions are the safest way to save, while a further 19 per cent think that a personal pension is the safest.

In comparison, over half (52 per cent) of employees see workplace pensions as the safest option and less than a quarter (23 per cent) believe that property is the most secure.

One in 10 (10 per cent) employees cited a personal pension as the safest retirement saving option.

Commenting on the statistics, Royal London pension specialist, Helen Morrissey, urged the government to review auto-enrolment policy to help the self-employed save for retirement.

“While property has its place in a retirement planning strategy, care must be taken not to be overly reliant on any one asset as if prices fall then retirement plans can unravel,” she stated.

“Boosting pension participation among this group is vital and yet they remain frozen out of auto-enrolment – a policy that has boosted the retirement prospects of millions. This is something government must review urgently.”

The ONS data showed that 52 per cent of employees believed that occupational or personal pensions would make up the largest proportion of their money in retirement, compared to 22 per cent of the self-employed.

Its research also highlighted a lack of pension understanding amongst working adults in Britain, with less than half (44 per cent) feeling that they understand enough about pensions to make decisions about saving for their retirement.

Furthermore, only 32 per cent of working adults had given any consideration to how many years of retirement they would need to fund.

“We must do more to close the guidance gap,” commented Aviva head of savings and retirement, Alistair McQueen.

“The government-backed Money Advice Service can be a force for good here, and the industry must continue to work with the regulator to ensure rules do not prohibit help.

“Savers are saving, but now much more must be done to help them.”

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