Pensions falling as savers rely on property

03/10/2011

The number of people putting cash into a pension has fallen dramatically, with one in seven savers admitting they have stopped and will never restart.

According to a report by LV=, it is estimated that two million over-50s are relying on property rather than a pension for their old age.

It is thought that the over-55s are currently responsible for £1.9 trillion in property value. Vince Smith-Hughes, of the pension company Prudential – who were responsible for the research told This is Money: “Neglecting pensions today means throwing money away tomorrow.

“Abandoning your pension pot really should be a last resort when times are tough.”

It is the squeeze on income as a result of the increased cost of food, fuel, clothes and other essential items that is thought to be behind one in five of those asked telling Prudential they have abandoned their savings plans ‘temporarily’.

Even a one-year break in pension saving could have a severe effect on income. Prudential has calculated that a saver who misses one year of £2,400 contributions could lose out on £7,000.

Investment firm LV= has revealed nearly one third of over-50s will use their home to pay for all, or part, of their retirement.

Tags; Current UK Economy, Income Worries and Debt, Retirement Money Problems,

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