How much is enough for your retirement?

A new study by HSBC has identified that 1 in 5 people will never have enough money to retire.

Is this something that should concern you?

At one level of course it should worry us all; the fact that a large portion of the working public won’t be able to choose the timing of their retirement and the sort of lifestyle that they want is pretty awful in the day and age.

These people will, by virtue of not having saved at all or enough, will be come dependent upon the State to look after them and that means higher income tax bills for everyone.

Also we should be concerned about the quality of life that reliance on the State brings.

As retirement might well be in excess of a quarter of a person’s lifespan it could mean a total lack of fulfilment.

The introduction of auto enrolment into an employer sponsored pension scheme is well underway and despite my initial misgivings about the effectiveness of this approach, early indicators are that most employees automatically enrolled are not simply opting-out at the first chance.

In the long-term therefore auto enrolment might help facilitate better future pension provision.

But the real challenge has not changed in all my years in the financial services sector.

Given the demands on the average wage packet of paying for the living costs today and with only a little left available for discretionary spend it is hardly surprising that many people find little scope for saving for retirement.

I am not trying to excuse them but we do need to be realistic about the subject.

Today is always going to be seen as more important than tomorrow.

Perhaps stark headlines like those revealed in the HSBC study might at least get some people thinking about the subject.