More than a third of those aged 60 or over have debt they may find difficult to pay off on a retirement income, according to LV= Wealth and Wellbeing research.
Research found that 55% of the working population were uncertain about how to prevent running out of money in retirement.
Additionally, 57% felt they lacked knowledge about how to withdraw funds from their pension in a tax-efficient manner.
Chancellor Rachel Reeves will deliver a keynote speech at Mansion House tomorrow (14th November 2024).
The Government indicated that her address will focus on Labour’s economic growth strategy, particularly the consolidation of Local Government Pension Schemes to improve investment returns for savers.
This situation is worsened by the ongoing cost-of-living crisis, inflation, and the lingering effects of the Covid-19 pandemic, which could lead to difficult times for retirees and those planning to leave the workforce.
The Government has initiated a major review of the pensions sector, led by Pensions Minister Emma Reynolds, aiming to enhance retirement security while boosting economic investment.
Katherine Carnegie, chief commercial officer at LV=, said: “The pensions industry will be monitoring Chancellor Reeves’ keynote address with keen interest, particularly for any signals regarding the next steps.
“The second phase of the pensions review, the Government has indicated, will explore steps to improve pension outcomes, including evaluating the savings people need to secure the retirement they desire.
“Building awareness of how to plan effectively for retirement must be at the forefront of this as many people have not been equipped with the knowledge needed to make informed pension choices.
Carnegie emphasised the importance of professional financial advice and encouraged individuals to preview LV=’s Guide to budgeting for retirement.
Carnegie added: “A house is only as strong as its foundations, and long-term saving is an integral element of UK society, ensuring people can enjoy a fulfilling retirement and benefit the UK economy.
“By launching the pensions review at the very outset of its administration, the Government has implied the centrality of the pensions sector is fundamental to its agenda.
“The Chancellor’s Mansion House speech on Thursday can serve as a ground-breaking moment. Then the real spade work must begin.”
