Aaron Abraham, IFA - Millennials unsure how much pension income they need

Wednesday 10 October, 2018

Aaron Abraham independent financial adviser based in Harpenden but working with clients in central London and Wimbledon reviews the findings of The Pensions and Lifetime Savings Association (PLSA).

The Pensions and Lifetime Savings Association (PLSA) has announced new research - Hitting the Target - A vision for retirement income adequacy. This is a three month consultation with the aim of enabling everyone to achieve a better retirement income.

The Pensions and Lifetime Savings Association (PLSA) Report

The report concluded that eight in ten people are not convinced they are saving enough for their retirement.   This is the equivalent of 30.4 million working age people.  Also over half those consulted (51%) thought the auto enrolment minimum pension contribution level was the government’s recommended amount that people needed to be saving into a pension.

Aaron Abraham, independent financial advisor Harpenden and central London said:

‘It’s obvious from the PLSA report that more needs to be done to help people when they retire. Over a third of the survey said that they could save more towards their retirement, but respondents were uncertain about how much income they will actually need in retirement. The minimum auto enrolment pension contribution level is due to increase to 8% next year from 5% this year. However, over half the survey believed that this was the recommended amount to save into a pension, not the minimum people need to live off.’ 

Aaron Abraham, independent financial advisor, Harpenden and central London continued:

“The PLSA report has made a number of very useful recommendations. They want to ensure more people get involved with the retirement question so they want to increase more retirement planning discussion. They want the government to introduce targets so people are aware of the type of lifestyle they could expect if they save a certain percentage of salary until they retire.  They also recommend the government raise the minimum contribution levels for auto enrolment and review the employer contribution. The PLSA report would like to see more support for anyone who is retiring to ensure people make the right product choices, and make it easier for people coming up to retirement to access other income sources to supplement their income. Finally they are looking to improve how pension schemes are run so it is obvious if a pension scheme offers good value for money.  All these issues affect Millennials who are saving for their retirement. If you are a millennial reviewing your financial planning options we recommend that you contact a financial adviser if you need pension advice.’

 ‘A pension is a long term investment. The fund value may fluctuate and can go down. Your eventual income may depend on the size of the fund at retirement, future interest rates and tax legislation.’

 

Pension Income for millennials

Aaron Abraham, independent financial adviser and member of the Harpenden financial planning team

Aaron Abraham, independent financial adviser and member of the Harpenden financial planning team

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