Future pensioners ‘plan to explore the world’

Pension savers’ retirement plans are more likely to involve exploring the world than putting their feet up at home, research has found.

As well as travel, dining out regularly and taking up a hobby feature high on the list. But one in 20 people believes they will never be able to retire. Picture: Getty
As well as travel, dining out regularly and taking up a hobby feature high on the list. But one in 20 people believes they will never be able to retire. Picture: Getty

A survey by pension scheme Nest revealed that “grey gap years” are the activities working age people who are yet to retire are most likely to have in mind for their later years.

Nearly two-thirds (62 per cent) of those surveyed aspire to go travelling or on a string of holidays, while nearly two-fifths (38 per cent) plan to enjoy their retirement by dining out regularly and 45 per cent will take up a hobby.

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Despite many people having their retirement dreams mapped out, one in 20 consumers does not think they will ever be able to retire.

Having a well-earned rest and treating the family were also popular choices. Just under half of those surveyed are looking forward to spending some time relaxing at home, and around one in four plans to treat grandchildren.

Matthew Blakstad, head of member policy at Nest, which was set up as part of UK government reforms to automatically place people into workplace pensions, said: “Future retirees are setting their sights on living life to the full. It’s fantastic that people are planning to carry on enjoying the things they love doing today in later life.

“Many of us regularly put aside some of our wages to fund our summer holidays. Financing how we want to spend our retirement needs the same kind of forward planning.”

Automatic enrolment into workplace pensions started in 2012, to head off fears that people are living longer but failing to put enough cash aside for their old age.

Five million people have been placed in a workplace pension, and there are around another five million still to be placed in a scheme as auto-enrolment continues to be rolled out across employers.

While many people are dreaming of a sun-soaked retirement, they may also need to do more work on their retirement planning to make these aspirations a reality, the research suggests.

Half of people surveyed do not think they are saving enough to live comfortably in retirement, and 22 per cent are unsure whether they are saving enough.

One in three (33 per cent) of consumers see their workplace pension as their main source of income in retirement, while 21 per cent believe the state pension will give them their main income.

Some 17 per cent of those surveyed do not know what their main source of income will be, and some consumers are pinning their hopes on a lottery win or a lucky game of roulette.

l Aviva is writing to around 700 people who have been receiving pension underpayments due to a calculation error.

People who may have been affected would have been working for the RAC automotive services company between 1990 and 1993 and are drawing their pensions.

Aviva, which started administering the pension scheme involved in 2008, said the error was made by previous scheme administrators, which meant that the correct calculations were not applied in some cases.

Those who were affected by the blunder were underpaid by around 2 per cent of their annual pension benefit on average.