A survey has revealed that 38% people aged between 18 and 24 are very confident about retirement - and expect to be able to afford the lifestyle they want - while just 23% are pessimistic. This optimism endures right up until the age of 35, when there's an unfortunate tipping point.
The statistics from Skipton reveal that at this point, for the first time, more people are pessimistic about their retirement prospects than are optimistic about them.
Ignorance is bliss
What's more, it found that their earlier optimism was based largely on ignorance. Younger people are confident, despite the fact they have made very few preparations - either because they have no idea what they will need to retire on in future, or they imagine it's so far away that they really don't need to worry about it just yet. Four out of five of them have no idea what they need to do - or indeed how to save for retirement.
When they get to the age of 35, reality begins to dawn, and as they get older, they get even more worried. Optimism reaches a real low point between the ages of 45 and 54, when 39% of people say they won't be able to live the life they want in retirement.
The only ray of light in the research is that when people start to tackle their retirement savings in earnest, they start to feel a bit more upbeat about things. Pre-retirees surveyed who are actively preparing for retirement are over three times more likely to say they are confident they will have the lifestyle they want compared to those that are not preparing.
Looking specifically at those aged 55-64, 50% are taking or have taken active steps to prepare for retirement, and two in five agree they will be able to live or are living the lifestyle they want in retirement.
However, in order for this kind of planning to be effective, it has to start much earlier than your 50s. The problem, according to the researchers, is that when people reach the age of 35 and realise they need to start saving, they have taken on an enormous number of responsibilities - such as a mortgage and children - and they struggle to find the extra cash to put away for retirement.
In an ideal world, therefore, younger people will be encouraged to do more than just the bare minimum required by auto enrolment - the first day they enter employment. If they start putting meaningful sums away from the beginning, it will feel like less of a financial wrench to have to start in their 30s, and so by the time they reach their 50s, they will have 30 years of saving under their belt.
The question, of course, is how to make this happen. How can a 20-something be persuaded that alongside the crazy cost of living and paying off student debts, their meagre salary also needs to be stretched to pay for retirement? And how can they be persuaded that despite their unfounded optimism, if they don't take steps now, they'll be in for a horrible shock further down the line?