New year, new financial you?

Many Brits haven’t made provisions for their dependants after they die or started planning for their finances in later life.

According to research conducted by MoneySuperMarket 42% of all respondents admit to currently having life insurance – 9% more than in 2018.

However almost half (46%) still do not plan on taking out a life insurance policy, despite it being one of the best ways to clear debt and help dependants after the policyholder’s death.

The data shows that 92% of Brits are also unaware of how much they need in their pension pot to live a comfortable life in retirement. The average pension pot can require as much as £298,000.

Despite this, millennials (18-34-year olds) in particular show a lack of knowledge about pension planning, with 62% of them underestimating the amount needed to live comfortably in retirement, with 16% thinking they would only need £50,001-£100,000.

42% of all respondents said they are saving for retirement, yet for 18-24-year olds a home is a higher priority, with 58% saving for a property. On the other hand, women are more likely to put money aside for a holiday than men (12% of women vs. 9% of men).

Rachel Wait, consumer affairs expert at MoneySuperMarket, said: “Brits face all sorts of calls on their money and it’s easy to see why the cost of everyday living can trump longer-term objectives such as saving for retirement – especially if you’re not fully aware of how much you’ll need in retirement. But anyone who can get into the savings habit gives themselves a better chance of building up the sort of pension kitty that’s needed to fund a comfortable lifestyle once they stop work.

“Anyone who has dependents should consider life insurance in order to ensure financial security for their loved ones. Policies can be set up to pay off a mortgage and other debt, as well as help provide money to meet the day-to-day financial needs of those left behind if the policyholder passes away. As a result, it’s important that people take the time to look for a policy that’s best suited for their needs.”