A new survey has indicated how the cost-of-living crisis has affected UK adults’ retirement strategies.
A fifth of UK adults aged 40 and above have delayed their planned retirement date because of the cost-of-living crisis, according to new research by My Pension Expert.
The at-retirement adviser commissioned an independent survey of 1,254 UK adults aged 40 and above. It found that 37% of those in work believe the cost-of-living crisis has made retirement impossible for the foreseeable future – this was the exact same number (37%) for the 40-54 age group as it was for the over-55s.
21% have delayed their retirement date due to rising inflation.
Meanwhile, of the over-40s currently in work, 7% said they had “unretired” in 2022 because inflation meant they needed to top up their retirement savings.
Just 33% said their pension savings and investments are managing to hold their value in the face of rising inflation, while 7% have switched pension providers or plans in 2022 to achieve better returns.
My Pension Expert’s research showed that despite concerns over their finances and many having to unretire, only 13% of over-40s in the UK have spoken to an independent financial adviser about their pension strategy.
Andrew Megson, executive chairman of My Pension Expert, said: “Even in the best of circumstances, the prospect of losing a steady source of income can be daunting for those entering retirement. However, with the cost-of-living crisis worsening, the disheartening truth is clearly that many are having to reconsider their retirement plans despite decades of saving.
“Given many are changing their pension plans, the fact so few have sought financial advice is concerning. An adviser can help planners assess their retirement strategy based on their financial circumstances and needs, balancing that against the economic situation. It is a question of deciding how to save or invest and the types of products that are right – from annuities to flexible-access drawdowns. There is no one-size-fits-all. People need advice tailored to their situation.
“For this reason, it is crucial the Government works to improve access to independent financial advice, ensuring people understand advice is for all and not just the wealthy. Doing so will prevent savers making rash or risky decisions involving their retirement finances in an effort to counter inflation, instead leading them to the comfortable, secure retirement they deserve.”