As everyone knows, the earlier you start saving towards your retirement, the more comfortable it should be with a larger income. HSBC recently commented that if a person of 25 started to save towards retirement, he or she would have a 50% bigger pension than someone starting to save at 35 would. They had conducted surveys that highlighted around 23% of people retiring would depend almost entirely on State benefits.
Our View
As we have said on many occasions, the State system does encourage people not to save for their future. The mentality is still that 'the State will provide'. Currently they will but only to a subsistence level. People must start to understand exactly what the State will and will not provide and seriously consider if they can have the lifestyle they want on the benefits they will receive. Most people can afford to make at least some regular payment into pensions or other forms of saving. We would advise people to take planning for retirement seriously, if you want to enjoy it. People are living longer and longer and this means more years in retirement. It also means probably more active years where people may wish to travel. Will you be able to live a fulfilled life on a State pension alone?