49% of staff changed retirement plans due to cost-of-living crisis

retirement plans pensionsAlmost half (49%) of working adults have changed their retirement plans because of the cost-of-living crisis, according to new research by the Pensions Management Institute.

The professional body that supports and develops UK pension schemes surveyed 2,030 employees with pensions. It found that 24% of respondents have delayed their retirement, 23% reduced their pension contributions, and 5% admitted to stopping contributions entirely.

Two-thirds felt that they did not have the knowledge required to choose their pension provider, despite nearly 60% showing some interest in being able to choose for themselves. Just 30% believed that the state pension will be more than half of their retirement income.

Meanwhile, 58% planned to take retirement benefits totally or mainly as an income, while 25% were interested in taking their pension savings totally or mainly as cash. Eight in 10 (81%) valued a retirement income that would be guaranteed for life, and two-thirds were attracted to an income that kept pace with price inflation.

Tim Box, council member at Pensions Management Institute, said: “Our research shows the concerns that many people have about how well they can prepare for retirement. The role of private pension provision to fill the gap is critically important. If the state pension age is to be raised to 71, as has recently been speculated about, then private pension savings are likely to be the only source of income between stopping work and the commencement of the state pension for a huge swathe of those born after 1970.

“These additional statistics show that it is vital that the government ensures that savers are given appropriate support and education to save for retirement in an era when it is likely that state pension benefits will only become available in an individual’s eighth decade.”