More than a quarter of over-50s will only start to plan their retirement finances with two years or less to go before they finish work, a survey has found.
A survey of people aged 50 to 70 with pension savings found 27% of those yet to retire will only start making plans with two years or less to go.
A further one in 10 (10%) do not intend to plan their retirement finances at all, according to the Money and Pensions Service (MaPS).
More than a third (36%) of 50 to 70-year-olds said their finances have been impacted by the Covid-19 pandemic.
Nearly a fifth (18%) have decided to delay accessing their pension, while 14% intend to access it sooner – with some saying this is to help their day-to-day finances or to support a family member or friend.
The research was released to coincide with Pension Awareness Day on Tuesday, to help people make the most of their pensions.
Carolyn Jones, head of pensions policy and strategy at MaPS, said: “Given over a third of over-50s have had their finances affected by Covid-19 and we’re now facing a recession, we’re urging people not to delay or skip planning their retirement finances – whether you’re thinking of retiring later or bringing it forward.
“Your pension is likely to be one of the most valuable assets you hold so it’s really important to start planning early to make sure you make the best choices based on your circumstances.
“Getting help and talking through your options now could be the difference between having a comfortable retirement or having to work for longer or adjust to living on a lower income.”
More than 2,000 people aged 50 to 70 were surveyed across the UK in August.
The Money and Pensions Service has tips to start planning retirement finances:
1. Track down your pension pots and check their value. The average person has 11 jobs in their lifetime. If you think you have lost track of a workplace pension, the first port of call should be your former employer, or you can contact the provider. If you cannot find details of either, you can contact the Government’s Pensions Tracing Service. Check your statements or ask your scheme or provider for an up-to-date valuation of how much you have saved.
2. Consider your living costs in retirement. The Money Advice Service has a free budget planner tool.
3. Think about what age you would like to retire at and when you would want to access your pension savings. For some people, this may not necessarily be at the same time. Some people may have already chosen a retirement age with their provider, but if your circumstances have changed and you plan to retire earlier or later, you may wish to reconsider how your savings are being managed to ensure your money is working hard for you. The Money Advice Service’s pension calculator may help.
4. Consider if your spouse or other family members need to be factored into your plans. If you wish to provide for family members with your pension savings, this could affect your choices when accessing your money.
5. Make a free Pension Wise appointment. Available to people aged 50 and over, specialist guiders will explain the pros and cons of the different options for accessing your pension savings, tax implications, how to shop around to get the best deal and avoid pension scams. Telephone appointments are available on 0800 138 3944.