Retirement, Pensions and Generation X (and Y!)
It’s a challenge to make a blog post on pensions interesting but I’ll give it a shot!
Defaqto, who provide independent financial research, recently surveyed people under 35 years old and found that less than half of them had a pension of any type. In a previous study carried in 2010, Defaqto found that 44% of consumers were not confident that their needs would be met in retirement and only 11% were very confident that their pension provision would do the job for them. Not an uplifting start to my post I’ll grant you! At our firm we try and make retirement something to look forward to, not something to fear. If retirement is an unknown and frightening stage you don’t want to think about then please take it from me, you need to do something about it and the earlier the better.
If you are aged over 20 and below 35 then you’ll either be part of what’s called Generation X or Generation Y. If you were born sometime between the 60s and 1980 you’re in Generation X, apparently marked by cynicism and a desire for independence! So you’ll need to put the cynicism to one side and speak to a financial planner if you want to achieve that independence… If you’re part of Generation Y then you are supposedly more optimistic than the Xers but don’t assume that your financial future will be rosy with no planning!
So should you have a pension? Certainly there are people for whom a pension might not be the best vehicle to use to get to retirement but that does not alter the fact that you will still retire one day and you need to save for it one way or another!
The media delights in highlighting when pension funds suffer and you could be forgiven for thinking that a pension is a sure way to lose money. Stories about those approaching retirement losing money underlines the fact that when we invest there will always be an element of risk but don’t forget that the degree of risk can be managed. If your retirement funds are in a high risk portfolio coming up to your retirement age and the world markets wobble or fall then yes, you’ll in all likelihood see your fund drop in value. This is where the ongoing services of a financial planner are invaluable. On your run up to retirement we will review your needs with you and gradually de-risk your portfolio as you approach your retirement age. This results in your fund becoming less and less exposed to stock market volatility so if the worst happens you aren’t as adversely affected (if at all).
I’ve seen the relief on a person’s face when they realise that they can, with careful financial planning, aspire to a free and full retirement. We take the guesswork out of your future and will make the journey to retirement with you.
Visit our contact page and take your first step towards securing your future.
P.S. Generation X by Douglas Coupland is a great read – check it out ;o)
By David Gibson
Coleraine.
