Retirement unlikely for millennials

Gardening and golfing are off the menu for almost a quarter of millennials who are convinced they’ll never be able to retire

Some 24 per cent of 18-35 year olds believe they will never be able to afford to retire, according to a new survey. And the same amount are worried that they will have to continue working in some capacity after they retire.

The survey of 2,000 millennials found that low funds is a barrier to saving, as 19 per cent said they can’t afford to invest in their pension.

The new research from Printerland.co.uk discovered that a fifth of those surveyed admit they don’t think the state pension will be on offer when they reach retirement age. This means they could be missing out on £8,546.20 per year. Despite being enrolled in their workplace pension, almost a third of millennials are still living with their parents. This living situation could be long term too, with 15% believing they won’t ever be able to afford their own house.

The research found that millennials’ ability to save has been cut in half by their pension scheme, with the average 18-35-year-old saving £126 each month and putting the same number of pennies into their pension pot. This leaves 18 per cent unable to save any money outside of their pension contributions.

Uncertainty around the subject is an issue, with nearly half (45 per cent) not knowing how much money they will have saved in their pension when they retire. Almost a quarter (21 per cent) of confused respondents don’t understand how their pension works altogether. When asked to estimate, the average millennial expected their final pension pot to contain £226,803.

According to data from Which.co.uk, you’d need a pot of £370,000 via an index-linked, joint-life annuity to receive £26,000 a year.

Catherine Bannan, HR Manager at Printerland.co.uk, said: “While millennials are aware of pensions, and understand they should be investing in them, some important details are still misunderstood. Researching and becoming educated in these details may be the next step for this generation.”

ONS data from 2016 showed that the number of Brits aged 65 and over who work had almost doubled – from 5.5 per cent (478,000) in 1992 to 10.4 per cent (1.19 million.)