Saving levels in the UK have hit an all-time low following a “perfect storm” of economic uncertainty and a rapidly ageing population, Scottish Widows warns.
A new report by the provider, published this week, suggests just 45 per cent of those who “could and should” be preparing financially for old age are saving enough.
This figure is based on the assumption people who are aged 30 or over, who are not retired and are earning at least £10,000 a year should be saving at least 12 per cent of their income or expecting their main retirement income to come from a defined benefit pension.
It is the lowest figure recorded since Widows first published the annual study in 2005.
Scottish Widows head of pensions market development Ian Naismith says: “We are being hit with a triple-whammy of, first, continued economic uncertainty making it difficult to save for the long-term; second, the age of first-time buyers is rising as we face troubles getting on the property ladder and, third, an ageing population.
“These factors combined create a perfect storm for those heading towards retirement.”
Widows says average private savings, combined with the state pension savings, will provide an income of £11,400 in today’s prices – less than half the £25,200 people expect to receive in retirement.
Forty Two Wealth Management partner Alan Dick says: “These figures are a massive concern and provide a great example of the need for proper financial planning.”