Member Article

Do we need to re-think pensions?

*With new research showing most people are in their mid-40s before determining the amount they need to save for retirement, Paul Gilsenan, Principal of Paul Gilsenan Wealth Management, a partner practice of St. James’s Place Wealth Management, considers whether a different way of thinking is the key to successful pension savings. * We all have an image of retirement – cruises around the Italian coast, fully paid-off home, helping the grandchildren; what many fail to calculate is the cost to fulfil these dreams. Indeed, new research from insurance firm Aviva shows that most of us are in our 40s before even asking the question.

Instead of preparing for the future, many are ‘living for today’ with 12% of over 50s considering a big purchase, such as a car or kitchen, before topping up the pension pot. Combine this with still stagnant wages, rising living costs, and so many stories of pension investment gone wrong, and it is little wonder people retirement savings are being pushed down the priority list. So, what is the solution?

Perhaps we need to start thinking of pensions not as savings for a future none of us are certain of, but as a regular monthly cost, like your holiday pot, mortgage or car payments. Whilst this could help to discipline people to save, the question still remains, what should this payment be?

The best way to get the answer is to sit with a professional financial advisor and start talking. The solution will be different for everyone and will undoubtedly change as your personal circumstances do. However, having a professional by your side throughout the journey will ensure you are always in the best position to adapt, while keeping to your ultimate goal.

Whilst we would always advise the earlier the better, realistically it’s never too late for a professional assessment of your circumstances. Solid advice and strategy can help you stay on-track, giving you an image of retirement that is less fantasy and more fulfilling.

This was posted in Bdaily's Members' News section by PSG Wealth Management Ltd .