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Savers put holidays before retirement

More people are saving for their next holiday than for retirement, according to a report from Defaqto.

The Retirement Income and Savings Report, published last week, highlights the complacency that many people have about retirement funding, with over one-third saying they are not saving at all.

Seventy per cent of respondents said they would be relying on the state pension in retirement while many wanted more guarantees about how much their savings would grow and also more incentives to save in the first place.

A third of respondents thought that contributing to a pension should be compulsory and around half said employers should have to provide pensions for employees.

Pensions and wealth management principal consultant Matt Ward says: “Our research showed that many people are sleep-walking into retirement. While the majority are planning to retire from full-time work at or around normal retirement age, many people realise that their income in retirement may not meet their needs.”

For this reason, he says 50 per cent of workers expect to continue doing some work in retirement or to defer their retirement to make their savings last as long as possible.

Ward says: “Relying on part-time work could be really dangerous, partly because the jobs might not be there when they are needed and partly because people may not be able or, indeed, incli- ned to work when it actually comes to it.”

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