Almost three in five (59%) UK adults are worried about having enough money to last them in retirement, with only 13% saying they have no worries that their savings will last. Yet, almost one in four (23%) – equivalent to 11.8m UK adults – say they are more worried about their looks than their pension when they think about getting older, with 22% spending more each month on personal grooming than retirement saving.
- 59% of adults worry about having sufficient savings to last them in retirement – but only 44% are actively saving and just 31% check each month to see if they could afford to save more
- Yet almost one in four (23%) worry more about their looks than their pension when they think about getting older
- 38% of 25-34s spend more on personal grooming than saving
- This comes despite more 25-34s worrying about retirement savings than the cost of raising a family, buying a home or paying off a mortgage
- Across all age groups, over 17m adults are worried about not having enough money to last in retirement without taking proactive steps to save
The figures are even higher among the younger group with more than one in three (35%) adults aged 25-34 who worry more about their looks than their pension, and 38% spending more on personal grooming than retirement saving each month. This comes despite 70% of this group saying they worry their savings won’t be sufficient to last in retirement and just 7% having no such worries at all.
Fewer than one in three review their saving habits each month
The research also highlights a gap between the theory and practice of improving savings habits. Asked for the top three things they would do with an unexpected £250 left over at the end of the month, over half (54%) of all adults surveyed say they would save it, ahead of 21% who would treat themselves and 20% who would put it towards a holiday.
But in practice, just 31% of adults – less than one in three – review their budgets each month to see if they can afford to save more, despite 60% saying they normally end the month with money left over after their usual expenses.
The contrast in behaviour leaves a divide between the 59% who are worried their retirement savings will not be sufficient and the 31% who check their budgets each month to see if they can afford to save more. It suggests at least 14.4m adults could be missing a chance to improve their prospects of affording a better lifestyle once they retire.
Concerns over retirement savings peak between the ages of 35-44
Aviva’s research shows that concerns over whether people’s retirement savings will be enough to last peak at 73% of 35-44 year olds, closely followed by 70% of 25-34s, with around one in five of both these groups saying they are very concerned.
Among the 59% of all adults who are worried about whether their retirement savings will be sufficient, less than half (43%) are not taking proactive steps to save for retirement. This leaves 57% who are worried but not taking positive action: equivalent to 17.3m adults aged 18+.
Even among the 44% of all adults who are taking proactive steps to save for their retirement, 58% are still worried that their savings will not be enough to last the distance once they retire.
More 25-34s worry about being able to afford retirement than property or a family
Concerns about physical health were the biggest worry for all age groups but worry about retirement finances was close behind.
In particular, more 25-34s are concerned about their retirement finances than about the cost of raising a family, buying a home, paying off their mortgage or supporting their own parents in retirement (see table 1). This is despite 42% saying they are already taking proactive steps to save for retirement, compared with 23% of 18-24s.
Table 1: Top five concerns of UK adults when they think about getting older
| Rank | All 18+ | 18-24 | 25-34 | 35-44 | 45-54 | 55+ |
| 1st | Your physical health - 72% | Your physical health - 75% | Your physical health - 75% | Your physical health - 71% | Your physical health - 71% | Your physical health - 70% |
| 2nd | Your retirement finances - 59% | Your mental health - 63% | Your retirement finances - 66% | Your retirement finances - 70% | Your retirement finances - 66% | Your mental health - 51% |
| 3rd | Your mental health - 57% | Getting on the property ladder - 62% | Your mental health - 63% | Your mental health - 60% | Your mental health - 55% | Your retirement finances - 48% |
| 4th | Your looks - 41% | Your looks - 60% | The cost of raising your own family - 62% | The cost of raising your own family - 50% | Your looks - 35% | Your looks - 29% |
| 5th | The cost of raising your own family - 35% | Helping your parents financially in their retirement - 60% | Helping your parents financially in their retirement - 58% | Your looks - 45% | The cost of raising your own family - 30% | The cost of raising your own family - 8% |
Almost one in four non-savers held back by low motivation or awareness
Lack of funds is the biggest barrier to retirement saving (cited by 56%) with people saying they need all their income to get by each month and for short- to medium-term costs.
However, nearly one in six (15%) non-savers cite a lack of motivation as the biggest barrier, saying they would rather enjoy their life now than save for retirement. Perhaps unsurprisingly, this is most prevalent among younger people, despite these age groups being most likely to worry about not having enough money to last once they do retire.
Alistair McQueen, Savings and Retirement Manager at Aviva, comments:
“It’s not uncommon to worry about the future, but millions of people in the UK are facing a very real concern about their retirement prospects. Putting looks to one side, the reality is many people are worried about their finances and cannot confidently picture their savings being enough to last once they retire.
“There is a risk of being paralysed into inaction, but despite only a third of people regularly checking to see if they could save more, there are encouraging signs that most people say they would choose to save if they unexpectedly found money left over at the end of the month.
“Worrying alone will never change an outcome and it is vital we help people move from being concerned to taking positive steps, however small, to improve their future prospects. Aviva is committed to helping people save smarter, and an important starting point is to picture your older self and the life you might lead once you retire.
“Identifying the retirement budget you need to make this possible makes it less daunting to start saving towards it. Even though money remains tight for many people day-to-day, a modest change in saving habits can give you a much brighter financial outlook once you retire.”
For more advice on how you can save smarter, try our Shape My Future interactive tool or visit our Save Smarter homepage.
Ends
If you are a journalist and would like further information, please contact:
Aviva Press Office: Fiona Whytock on 07800 692299 or fiona.whytock@aviva.com
Aviva’s spokesperson, Alistair McQueen, is available for comment/interview.
Methodology:
1 The research was conducted by Censuswide, with 2002 General Consumers aged 18+ in GB between 30th September and 5th October 2016. The survey was conducted from a random sample of UK adults. Censuswide abide by and employ members of the Market Research Society which is based on the ESOMAR principles.
Notes to editors:
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