Time and again financial planners have insisted on clients setting goals for retirement but the majority of the UK public are not listening.
Financial services firm Sanlam UK surveyed over 1,000 adults for its “What’s Your Number?” report and found more than three-quarters (77%) have not set targets for their retirement.
This equals 40 million people, according to current Office for National Statistics estimates, which places the population of Great Britain and Northern Ireland at nearly 52.4 million.
Worryingly, only 18% of those aged 45-55 have set retirement goals, which is the equivalent of 8.2 million UK adults financially sleepwalking into their later years.
There are some small differences between the sexes, as 18% of women have set a financial target for their retirement compared to 29% of men.
The survey also found 39% of UK adults don’t see setting targets as important for their financial planning.
Jonathan Polin, Sanlam UK chief executive, said: “’What’s your number?’ is a simple question, but the answer is often less straight forward. The gap between what people think they need and what they actually require in later life is huge, and sometimes life-changing.
“Despite years of industry effort to turn the tide, engagement with longer term savings, as highlighted in our report, is shockingly low.
“This suggests that we are about to see a tidal wave of people coming into retirement who will be ill-prepared and severely disappointed when faced with their retirement reality.
“By taking some very simple steps, setting clear financial goals, and identifying a clear path to get there, this nightmare can be avoided.”
Sanlam’s report found more than half (55%) of UK adults doubt they’ll be able to save enough money to retire when they want to, with just 12% of under-55s having a target pension pot size.
Despite high levels of awareness that their financial circumstances are problematic, too few are addressing the problem head on.
This lack of engagement is highlighted by the fact that people are four times as likely to know their lottery numbers off by heart than their target pension pot (11% vs 3%).
Sanlam also asked respondents about how they want their retirement years to look.
The top aims were not worrying about money (38%), maintaining their current standard of living (34%), and being free from debt (30%).
The irony is that only a small percentage are putting plans in place to make these aspirations a reality.