One in five adults expect to have to sell their homes to finance their re-tirement, a study by Prudential has revealed.
The firm’s research shows five million adults of working age believe they will never be able to afford to retire while two-thirds expect the income from their state pension to have dec-reased in relative terms by the time they reach retirement.
Around 40% of people plan to use cash savings and ISAs to supplement their pensions while just 7% are looking to use equity release schemes. Some 13% have no additional means of supplementing their retirement income and this figure rises to 21% when only taking women into account.
Gary Shaughnessy, managing director of Prudential retail life and pensions, says: “This report makes dep- ressing reading and highlights how many people fear they will not be able to afford to retire or will need to make a significant change in lifestyle to fund their retirement.
“Few will be able to rely on their pensions alone to provide retirement income so we are forming an independent panel of experts. This panel will examine planning and look at how non-pension savings, investments and property can all help people maintain their lifestyles into retirement.”
Peter Fisher, director of HSBC-owned retirement planning brokerage NHFA, says: “It seems that most people need a rea-lity check when it comes to their fi-nances going into retirement.
“Too many are taking early retirement and this is be-ing encouraged by employers eager to get older workers off the payroll.”
He adds: “Working later and considering phasing yourself into retirement gradually are sensible options. Equity release could also be part of the solution.”