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Equity investments to boost retirement income

One third of over-55s who have yet to retire plans to use stocks and shares in retirement to offset the effects of inflation on their income, according to research by MGM Advantage.

Two separate surveys of more than 2,000 people found that 53% of respondents rank the rising cost of living as their biggest fear for retirement.

Of those aged 55 or over and still working, 32% said they would retain some stocks and shares investments to protect against the negative effects of inflation on their retirement income.

The biggest retirement fears among UK adults:

  • the rising cost of living (53%)
  • staying healthy (45%)
  • losing their partners (32%).

Andrew Tully, pensions technical director at MGM Advantage, said:

“To maintain equity exposure in retirement while generating an income usually means using income drawdown. But, the risks associated with drawdown mean it is not for everyone, so we should exercise caution shoehorning everyone into that type of plan. For drawdown to provide sustainable income through retirement requires a high degree of exposure to equities, and therefore more risk.”

 

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