Nearly half of Brits face savings shortfall

ALMOST half (45 per cent) of Brits believe they do not have enough money saved to reach their life goals, while a quarter (26 per cent) have no pension plan in place, a new survey has found.

According to new research from Zurich UK, 18-34 year olds are most likely to miss out on dreams such as starting a family or going travelling, with 61 per cent of 18-24 year olds and 51 per cent of 25-34 year olds believing that a lack of savings will hinder them in later life. This compares with just 33 per cent of those aged 55 and over.

Although 72 per cent of under-65s said that they have plans for their retirement, 51 per cent believe that a savings shortfall will leave them unable to fulfil these goals. But despite recognising the importance of saving for their future, 26 per cent admitted that they do not have any pension, and 17 per cent have no savings at all.

“More has to be done to inspire people to take action and start saving,” said Anne Torry, head of Zurich UK Life. “Small steps such as reviewing everyday spending to realise a saving that can be used to increase monthly pension contributions will have a huge impact over the long term, as will taking full advantage of support within the workplace and contributions from employers.

“In a low interest rate environment, a professional adviser can also help to create a plan and make the most of savings. The earlier action is taken, the more likely it is that your savings will be sufficient to realise your aspirations today and in the future.”

The rising rate of inflation and record low interest rates have had a crippling effect on most savings accounts. However, since the base rate cut was announced in August 2016, peer-to-peer platforms have seen an influx of new customers, as savers look to alternative finance investments to deliver the returns that they can no longer get from banks.