A quarter of investors worldwide fear they are not saving enough ahead of retirement, while their current provisions may not be enough to sustain their desired lifestyles once they leave work, a report has found.
Baby-boomers were most apprehensive about their future retirements, with just under 35% saying they were concerned with the amount they were saving, while 20% of millennials were found to be worried about their future retirement funds, according to Schroders’ latest global investor study published last week.
The survey of 25,000 investors across the globe also found that people’s current retirement provisions are inconsistent with the amount they expect to draw each year when they retire.
On average, people expect to take 10.3% out of their retirement savings each year without running out of money, while a quarter said they would be able to withdraw at least 15% each year.
Sangita Chawla, Schroders’ head of retirement savings, said: “This disconnect is worrying and implies that people globally are not being realistic about the lifestyle they want to enjoy when retired.”
“People are living increasingly longer in retirement and should be able to enjoy their lives after work, safe in the knowledge that their retirement savings will sustain them. However, this study suggests this may not be the case for many.”
Schroders said that people globally are saving decent sums, with those in the Americas saving the least (14.5%) followed by Europe (14.9%). Investors in Asia were, on average, saving the most at 15.9%.
Despite being further from their retirement, millennials were saving the highest proportion of their annual income (15.9%), compared with Generation X, baby-boomers and people aged over 71 (14.7%, 13.7% and 13.1% respectively).
Chawla added: “It is imperative people start saving consistently and sufficiently as early as possible when working and, before retiring, do some serious thinking about the level of income they can afford to sustain throughout their well-earned retirements.”
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