Saving for retirement is crucial, research suggests

POSTED: 26th February 2013
IN: Personal News

It is paramount to develop good saving habits from an early age to ensure you have the right strategy in place to be able to afford the expenses of adult life.

undefinedHowever, saving for a mortgage is not the only issue young people have to take into account, as they do not want to be out of pocket when they reach retirement.

Research from Friends Life has, however, singled out a portion of over-50s that feel they are struggling to make ends meet.

The survey found 23 per cent of people questioned are finding it difficult to stretch their finances, with 65 per cent also saying they were worse off now than they were a decade ago.

This demonstrates the significance of saving early on and how money management is essential for ensuring a comfortable later life.

“This just highlights the fact that it is more important than ever to get the message through that saving for retirement is crucial,” commented Colin Williams, managing director of corporate benefits at Friends Life.

“If many are struggling to make ends meet whilst they are still working, then they may find themselves in more dire straits when they reach retirement, so early planning is crucial.”

Britons could look to the tax-efficient benefits of a cash ISA to kickstart their saving habits, with the annual limit rising from £5,640 to £5,760 from April 6th.

People also have until April 5th to make the most of this year’ ISA allowance so they can protect their funds from the taxman. 

Investment director of Fidelity Worldwide Investment Tom Stevenson commented: “Savers not using their ISA allowance are simply surrendering their hard earned money to the government.

“It is critical for savers to understand that these tax advantages can amount to thousands and thousands of pounds over time and make a very big difference to their final savings pot.” 

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