Britons could face ‘retirement debt agony’

Nearly 40 per cent of Britons are running the risk of not having enough money for their retirement. 

This is because research carried out by YouGov for TD Direct has discovered nearly four in ten consumers do not intend to make any investments for their post-work life in the next 12 months, opening up the possibility they will be forced to live on the state pension. 

The most people can currently get is £110.15 per week and while this figure will increase with inflation every year, it still might not be enough for over-65s facing rising living costs. 

Indeed, the laidback attitude is in stark contrast to people in North America and Asia, where planning for a comfortable retirement features prominently in the minds of workers. 

Stuart Welch, chief executive officer of TD Direct Investing, said that with wages "falling in real terms" and signs emanating from the Bank of England that an increase in interest rates may not be too far off, now really is the time for people to be thinking about retirement.

"The research shows that Britain lags behind the Americans and Japanese in planning for old age. It is striking to see such a discrepancy in pension planning," he added.

A recent study by Scottish Widows pointed to the procrastinating nature of Britons. Despite the fact nine out of ten people recognised the need for a post-work plan, 36 per cent admitted they had not taken any steps to make their retirement financially comfortable. 

Karen Pine, psychology professor at the University of Hertfordshire, said part of the problem is that people in the UK have a mindset that is "dominated by short-termism and immediate gratification".

In terms of choosing savings products such as ISAs, seven per cent pointed to a lack of understanding as a big problem, while ten per cent think there are too many providers to choose from. 

By Amy White