Most savers don't start putting money away for retirement until they turn 50

MOST people are likely to start saving for their retirement in their 50s, while under-40s are focused on getting a house and starting a family.

The study showed adults in their fifties are busy saving for their golden years and having a bit of free cash to spend later in life.

It comes as separate research claims you need a pension pot of £587,116 per person, or £355,856 if you're in a couple, for a comfortable retirement – meaning some people could be left short if they don't save sooner.

Meanwhile, "comfortable" adult in their sixties will save £237-a-month for nonessential "big ticket" items such as holidays and new cars.

Those under 40 save for more "sensible" purchases, putting away just under £300-a-month for house deposits, new furnishings and starting a family.

However, almost one in six adults have struggled to save following the impact of the coronavirus pandemic.

Top tips to boost your pension pot

DON’T know where to start? Here are some tips from financial provider Aviva on how to get going.

  • Understand where you start: Before you consider your plans for tomorrow, you'll need to understand where you stand today. Look into your current pension savings and research when you’ll be eligible for the state pension, and how much support you’ll receive.
  • Take advantage of your workplace pension: All employers are legally required to provide a workplace pension. If you save, your employer will usually have to contribute too.
  • Take advantage of online planning tools: Financial providers Aviva and Royal London have tools that give you an idea of what your retirement income will be based on how much you're saving.
  • Find out if your workplace offers advice: Many employers offer sessions with financial advisers to help you plan for your future retirement.

And 35% admit their savings fund is now primarily being used as back up in case of loss of income, rather than saving for anything particular.  

It also emerged that in these difficult economic times, it is adults in their thirties who are most likely to be squirreling money away just in case they lose their jobs.

While those in their forties are the ones putting cash aside for an unexpected reduction income.

The study also found that, surprisingly, adults in their twenties are also most likely to have a "save don’t spend" attitude to their finances, contrary to popular belief that the younger generations don’t save.

Young adults in their twenties will put money aside for a wedding and begin saving for a baby in their thirties.

Those in the younger age groups are also more likely to have something in mind when saving, with those in their twenties putting away an average of £308 a month and those in their thirties £295.

Just four in 10 of the over sixties age group will specifically have something to save for regularly, and are less likely to have more than one savings pot on the go at any one time.

Adults in their thirties are more likely to save for things to help them set up for the future – such as furniture, a garden room, or moving house – although they do also hanker over the latest fashion items such as clothing and shoes.

But the youngest polled – those in their twenties – are driven by gadgets, and hope to spend their hard earned cash on items such as a new TV or smart phone when they are not saving for weddings and a home of their own.

Researchers for OnePoll found overall, Brits have found it hardest to save after household income reduced following the birth of a child (23%), and when unforeseen problems happen with the house (20%).

Other reasons saving plans have been shelved over time include being addicted to shopping (9%), taking a job on a lower salary (12%) and having a partner who stopped working (7%).

Maitham Mohsin, head of savings at Skipton Building Society, said: “Some adults are fortunately able to save more money than ever at the moment as they’re continuing to work but spending less, due to reduced commutes and less available entertainment.

“There are however, many who are concerned for their financial stability, and who are literally putting every penny into a savings account just in case.

“At Skipton, we know that when your money is in a good place, so are you, so it’s reassuring to see through our study that despite the Covid-19 pandemic, most British adults are sensible when it comes to their savings.

“Our research revealed the average household is able to put away just under £300 a month into their savings pot, which is a substantial amount, especially given the pressures some adults are currently under.”

How pension fees could reduce your savings pot by hundreds of thousands of pounds – and how to avoid them.

Women £106k worse off than men at retirement due to lower paid jobs and part-time work.

And here's how to boost your state pension by up to £250 a year.

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