Some plan to work past their retirement age to beat the cash crunch, research finds.
More than eight million over-50s are approaching retirement fearing they will not have enough saved to last their later years, according to research.
New figures suggest up to 4.7 million women and 3.6 million men over 50 have this financial worry.
Many – more than a third of women over 50 and a fifth of men –have no private pension, meaning that they could be relying exclusively on the state pension of £175.20 per week.
Women tended to be more worried that they would not have enough to live on in retirement. Just 13% of women over 50 surveyed were confident they will be able to fully fund their later years, compared to 22% of men.
On average, women have pensions up to a third less than a man the same age.
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This is because they are more likely to be in lower paid professions or have taken time out of work to raise a family and then go back part-time.
Just under a third of all over-50s are hoping that their partner’s pension will cover their own expenses.
The figures from over-50s finance experts SunLife point to a widespread lack of preparation among the group with the least time to make up a shortfall in savings.
Simon Stanney, equity release director at SunLife, said: “The sooner you start saving into a pension, the better, but it is never too late. However, the older you are, the more you’ll need to put aside each month to build up that pot for retirement.”
More than a third (34%) of UK employees named funding retirement as their top money worry, with the issue coming out on top for the second year running in the 2019 Close Brothers Financial Wellbeing Index report.
One in five employees (21%) admit to worrying about their financial health daily, with only 19% having no concerns.
The top money worries in the UK are funding retirement (34%), being able to cope financially with a job loss (24%), paying off debts (23%), the state of the economy in general (22%), and how to make money last till payday (16%).
According to this index, financial confidence around retirement has increased on an annual basis, from an average score of 5/10 last year to a score of 5.9/10 today.
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However, 44% of those aged 65+ identify funding their retirement as one of their biggest money worries, and 50% of those 55-64 – this latter group being the most concerned of any age group.
Workers ranked the best savings methods for retirement to be a workplace pension (70%), property (58%), a savings account (55%), a cash ISA (52%), and savings or investment bonds (42%).
Jeanette Makings, head of financial education at Close Brothers, said: “While it’s good news that financial confidence around retirement has increased since last year, the UK’s pension problem looms larger than ever, with Covid-19 having led to a dent in the market and so people’s pensions and other savings.
“Against such a backdrop, it’s vital that people take stock of their financial futures and see what steps they can take to adjust their plans to meet their short, medium, and long-term goals.”
Many over 50s told the SunLife survey they will look to other income sources other than pensions for retirement income.
Around 12% plan to continue to work to provide an income, while 11% – equal to 2.7 million people – are expecting an inheritance to cover their living costs in retirement.
Property wealth is another potential source of income to supplement modest pensions.
SunLife’s research shows average homeowners over 50 have seen their properties rise in value by £127,316 over the past 20 years.
“For those worried that they will struggle to build up enough of a pension pot to fund their retirement, looking to property wealth could be a viable option,” said Stanney.
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