HSBC study says the average Brit faces 12 years of hardship after savings run out
UK workers don’t save enough for retirement, topping a league table of the worst-prepared for later life, a major study by banking group HSBC has found.
The average Brit faces 12 years of hardship in retirement after their savings run out, the worst identified in the study of 15,000 people in 15 countries around the world.
HSBC’s The Future of Retirement: A New Reality study found the average retirement in the UK is expected to last 19 years, but on average retirement savings will be used up after a third of that time leaving people with significantly reduced standards of living.
The group predicts this situation will only worsen as countries’ life expectancy continues to rise.
Christine Foyster, Head of Wealth Development at HSBC UK, said: ‘The concept of retirement is evolving all the time, and we know many people aren’t prepared. But now we know by just how much.
‘People are living longer, through tougher economic times, but their expectations about their standard of living in retirement remain unchanged. They are putting off the inevitable, which is the reality of significant cuts to their living standards in their twilight years, after their savings run out.’
Currently 56 per cent of workers in the UK are not preparing well enough for retirement. A staggering 19 per cent save nothing at all.
Despite this, 63 per cent of those surveyed said financial problems were their biggest fear about retiring.
Ms Foyster added: ‘People throughout history have faced the question of how to provide for the future, and today’s savers are no exception.Yet as daunting as the current challenges may seem, the solution is simple: the earlier you start to plan the better prepared you will be.
‘For some this may mean beginning to save more, whereas others will choose to work longer. The key is for everyone, regardless of age or income, to make small changes now to ensure they get the retirement they expect.’