Research by Standard Life has evidenced that people in Britain’s baby boomer generation, now approaching retirement, say that their biggest financial regret is not starting saving for retirement earlier.
Nearly one in seven (15%) of adults responding, admitted wishing they had started a pension sooner, with the figure rising to one in five for those approaching retirement. Independent financial advisers have long warned about the adverse affect of starting a pension later.
The top five ‘baby boomer’ financial regrets identified by Standard Life are:
1. I wish I had saved for retirement earlier.2. I wish I had avoided running up debt on credit cards or store cards.3. I wish I had set and stuck to a budget.4. I wish I had spent less on nights out and saved more in general.5. I wish I had sold things I no longer needed.
Those who start saving £100 a month at age 25, could receive an income of £3,570 a year by the time they are 65, according to Standard Life. On the same basis, with investment growth of 5% and increasing saving each year by 3%, someone saving the same amount from age 40 would have pension income of only £2,000 a year by the same age.
Official figures have shown how pension membership has rapidly declined. Less than half of all employees (46%) were part of a workplace pension scheme last year, according to the Office for National Statistics (ONS). That was the lowest figure since it started collecting similar data in 1997. Only 32% of private sector employees were saving into a workplace pension in 2012, in sharp contrast to the public sector, where more than 80% of employees were enrolled in a workplace pension scheme.
The ‘baby boomers’ interviewed by Standard Life were aged over 55. The wider definition of the term is those born during an explosion of births between 1946 and 1962, who today would be aged 51 to 67. This survey confidently concludes that many of these baby boomers are approaching retirement wishing they had been more money savvy when they were younger!