8 out of 10 people are unaware of how much they need to save to achieve their target for retirement, according to research by Seven Investment Management (7IM).
According to research findings, people believe that the comfortable retirement annual income for an individual is £23,400.
The maximum state pension is just over £6,000 a year, so based on retirement income people would need to be saving enough to generate £17,400 a year in retirement.
When asked on how much they need to save for retirement, 1 in 6 people said they were saving enough while 3 out of 10 said they were saving nothing.
More than half said they were anxious about their savings, increasing concerns of the scale of the savings challenges they could face.
7IM reported that the conservative estimate of saving for retirement would be £348,000 – over twice as much as many people estimated.
7IM co-founder Justin Urquhart Stewart, said:
“We’re living longer so its inevitable most of us will have to work longer. But if we’re to avoid working till we drop we have 3 options – save more, save longer and take more investment risk. The earlier you address the problem, the less drastic the solution.”