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One in seven have no plans to retire, says Barings

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One in seven (14 per cent) non-retired people, the equivalent of 5.1 million individuals, do not plan on retiring, according to the latest consumer research by Baring Asset Management. 

 
Representing an increase from 12 per cent in 2012 and 10 per cent in 2011, this is the highest such figure since the Barings’ annual study began in 20084.
 
In an indication of further uncertainty about retirement planning, 40 per cent, (the equivalent of 14.7 million people) of respondents said they did not know when they will be able to retire, up from 38 per cent in 2012 and 36 per cent in 2011.  Despite nearing the traditional retirement age, 34 per cent of 55-64 year olds – around 1.8 million people – said they did not know when they will be able to retire.
 
Overall, the research found that the average age when people say they plan to retire has also increased – to 64 years old in 2013 from 62 in 20095.  For people aged over 65 who have yet to retire, it also found that their expected retirement age is 71.
 
Marino Valensise, chief investment officer at Barings, says: “It is clear that uncertainty is increasing for many people around retirement plans, with more people unable to say exactly when they plan to retire and the average age continuing to rise.  Significant numbers of people nearing traditional retirement age reported they did not know when they will be able to retire and the worry is that a lack of sufficient financial planning and pension provision combined with increased longevity is having a real impact on a large proportion of the population.”
 
The research from Barings found that 34 per cent of people – the equivalent of 12.5 million – have no pension, a figure that has remained roughly flat since the annual survey was first carried out in 2008 (35 per cent).  The survey also found that just under one in five (18 per cent) of people in the A/B social segment do not have a pension, compared to 61 per cent in the D/E segment, and that there has been a substantial rise in the number of people aged 55-64 who say they do not have a pension, up to 31 per cent (1.69 million people) in 2013 from 22 per cent in 2008.
 
While the number of men with no pension has steadily declined, from 30 per cent in 2008 to 26 per cent in 2013, the number of women has risen, to 42 per cent from 39 per cent.  The difference between men and women in the 2013 survey – 16 percentage points – is the second highest on record, topped only by the 19 point difference in 20106.
 
Valensise says: “The fact that so many people say they do not have a pension, including relatively affluent people and those in the 55-64 age segment, underscores the need to focus on effective retirement planning.  We are alarmed that so many people who should have proper plans in place do not, and urge everyone to better understand the benefits that they can get from planning ahead and starting early.”

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