Saving Too Late Puts Your Retirement at Risk Says Aviva

A new report by Aviva, the UK’s largest insurance group, warns that workers who wait until the last decade of their employment to pay more into their pension pot are risking their retirement.

As the Government seeks to raise the state pension age to 66 by 2020, a new report by Aviva paints a bleak picture for over 55s.

The Real Retirement Report found that more than 25% of this age group is currently out of work due to illness or redundancy. An additional 9% of respondents said they were forced into early retirement while 8% were unemployed for more then 3 months between the ages of 55 and 65.

Once out of employment, 74% said it is harder to find a job when you’re over 55 than earlier in life.

The figures clearly show how the recent recession and Government cutbacks are hitting older workers, but more alarming are the figures showing that people start paying more into their pension too late to ensure a comfortable retirement – especially as the risk of being made redundant increases for over-55s.

According to Aviva, 34% of people questioned found that unexpectedly being made redundant or losing their jobs meant they had to cut back on spending in their retirement.

Moneyhighstreet comments: “As more people are working for longer, they unfortunately increase their risk of redundancy.

“In uncertain times, people with a pension can no longer assume that they will be able to spend the whole of the last ten years of their working life being able to pay more into their pension fund. So to ensure a comfortable retirement, you will need to start paying more in much earlier.

“As fewer people pay into a pension, the same advice holds true for savers putting aside savings for their retirement.”