Article date: 26 February 2007
- 60% of the world’s pre-retired adults worry theyhaven’t saved enough for retirement
- 48% of the world’s retired adults wished they had donesomething earlier to provide enough for their retirement
- Only 3 in 10 Brits are currently saving for retirement, comparedwith almost a half of Americans and three quarters of Hong Kongcitizens
- Aviva launches www.six-steps.org to providefree, unbiased advice on retirement planning1
Six in ten (60%) pre-retirees across the world areunder prepared for the financial rigours of retirement promptingreal concerns of a global pensions crisis, according to Aviva, thesavings, investment and insurance group’s survey intoConsumer Attitudes to Savings2006.2
The annual study, which has over three years surveyed 50,000people from 23 countries, conducted by Henley Centre HeadlightVision, found that 48% of all retired people regret not doing moreto provide for their retirement and half of all pre-retirees expectto work in their twilight years to fund their future.
Richard Harvey, group chief executive at Aviva, comments:“Our research shows that the pensions black hole is not justa UK-specific issue but an area of global concern. Broadly, theworld’s pre-retired population seems to have resigned itselfto the fact that the term ‘retirement age’ may notapply to a specific age and will become increasinglyambiguous.”
Sian Davies, chief executive of the Henley Centre HeadlightVision, comments: “From this global survey it is apparentthat consumers need to redress the balance between the age theyhope to retire and being able to fully meet their financial needsthroughout retirement.”
With this in mind Aviva has launched www.six-steps.org to engage moreconsumers in financial planning for the future. The free, unbiasedplanning resource has been created to help people make informedfinancial decisions about their retirement. The site takes peoplethrough six simple steps towards planning a secure and financialhealthy retirement:
- Step 1: Take control - make a plan for your future
- Step 2: Know yourself – how do you feel about money andtaking risks
- Step 3: Save little and often – put some money asideevery month
- Step 4: Invest for the future – build up your long termsavings
- Step 5: Protect yourself – look after yourself and yourmoney
- Step 6: Get advice – speak to a financial adviser
The Economic Secretary to the Treasury, Ed Balls, said: "We wanteveryone in society to have access to, and use, financial serviceswith confidence. Financial decisions can be difficult. Financialproducts are complicated and there can be too much jargon. Thisputs people off, or they can end up buying something that is notright for them. Sometimes people just want to discuss theirfinancial options and not buy anything. We believe there is a gapin the provision of this last type of advice - generic advice - andwe are pleased to see Six-steps.org playing a role in thisarea."
A house isn’t a pension it’s a home
Thesurge in house prices over the past five years in the UK is onearea where adults have increasingly looked to supplement retirementincome, with more than one in two Brits (58%) seeing their currenthome as “investments for their future”. This statisticprompts obvious fears that if property prices in the UK were tocrash, then many pensions would go too. This concern is not justconfined to UK shores - the Irish and the Americans are even morereliant on property prices.
Richard Harvey comments: “With property currently offeringhealthy returns it is easy for would-be retirement savers to beblinkered. We would urge all pre-retirees to diversify anyretirement portfolio and not to put all their savings under oneroof.”
A little understanding…
The perceivedcomplexities around pensions and savings appear to be a majorreason for many people throughout the world not saving forretirement - from 53% of Hungarians down to 23% of Germans.
Richard Harvey comments: “It is evident that thereare a significant number of people who want to arm themselves withclear and concise information and, in many cases, they are going onto the internet to find it.
“It is with this in mind that we have createdwww.six-steps.org - to allow people to demystify the retirementprocess, promote a greater understanding and to empower individualsto build their own retirement plan, without the pressure of buyingspecific products.”
Not saving and not concerned?
Savings meansdifferent things to different people - only one in five (20%)adults in the Netherlands are concerned that they have not savedenough to fund their retirement, compared with six in ten (58%)Americans. Currently 43% of the UK are concerned over the level oftheir current savings for retirement, however, only a third ofpeople in the UK (31%) are planning to use their savings forretirement.
Failure to plan
Currently, Eastern Europeans are themost averse to retirement planning. Perhaps this can be explainedthrough the history of the region, where the state would haveprovided in retirement. As expected, the numbers of retirementplanners in Western Europe is significantly bigger.
Richard Harvey concludes: “Retirement planning throughoutthe world is an issue that needs resolving. Globally, we are in asituation where inaction leads to anxiety rather than anxietyleading to action.
“As the population grows, so does the stress placed onstate pension schemes. Unless people make a concerted effort totake control of their retirement, by planning effectively, we shallcontinue to see a worrying trend that will ultimately lead tohigher numbers of people struggling to adequately fund theirretirement.
“Aviva has launched six-steps.org to enable pre-retireesthe opportunity to improve their retirement prognosis by helpingthem plan for all eventualities. Users are encouraged to set aretirement goal and work towards it to try to alleviate some of thepain that is faced by the current retiring generation.”
For more information please visit www.six-steps.org
For more information please contact:
Bev Aujla,Lansons Communications, 020 7294 3683 or firstname.lastname@example.org
Joe Laing, Lansons Communications, 020 7294 3649 or email@example.com
Rachel O’Hare, Lansons Communications, 020 7294 3625 firstname.lastname@example.org
Sian Davies, Henley Centre Headlight Vision, 020 7955 1800 email@example.com
Supporting quotes for www.six-steps.org
Stephen Haddrill, Director General of the ABI, said: "Thechallenge is to stimulate people to take a greater interest intheir financial affairs and to give them more confidence to takeadvantage of the wide range of advice already around. We believeSix-steps.org can play an important role in helping people plan fortheir future."
John Tiner, Chief Executive of the Financial Services Authority,said: "We welcome Aviva's commitment to improving financialcapability in the UK. The FSA is leading a National Strategy forFinancial Capability, working with a wide range of partners,including Government, industry and the voluntary sector. Over thenext five years, we aim to help at least 10 million people atdifferent stages in their lives become more confident in managingtheir money through programmes targeted at - among others -schools, young adults, employees in the workplace and newparents."
Teresa Perchard, Director of Policy at Citizens Advice, said:"There is a significant need to help thousands of people make themost of their money, both now and in the future. People need theconfidence and ability to budget, borrow and save effectively.Providing advice and teaching financial skills really does work asour bureaux have seen people improve their money management skillsand confidence significantly. We very much welcome initiativeswhich help with this."
- Notes to editors:
1 Six-Steps– it is not a commercial tool for the company and none ofits products are featured in the site. It is purely aimed athelping people plan for the future.
- Aviva is one of the leading providers of life and pensions toEurope with substantial positions in other markets around theworld, making it the world’s fifth largest insurance groupbased on gross worldwide premiums at 31 December 2005.
- Aviva’s principal business activities are long-termsavings, fund management and general insurance, with worldwidetotal sales of £36 billion and assets under management of £322billion at 31 December 2005.
- The Aviva media centre at www.aviva.com/media includesimages, company and product information and a news releasearchive.
- Norwich Union's website, www.makesenseofit.com, providesinformation about life and pension products. Aimed at consumerswho want to learn more about managing their money, the siteintroduces the basics of investing and highlights the benefitsof taking professional advice.
- 2 Consumer Attitudes to SavingsSurvey 2006 was conducted by Henley Centre Headlight Vision in Q12006 on behalf of Aviva plc. Henley Centre Headlight Visionprovides intelligence, consultancy and research solutions to bluechip clients around the world. All of their work is informed bytheir proprietary global knowledge base of trends and futuresinsights. HCHLV has a global footprint with offices in London, NewYork, Mumbai and Delhi and an intelligence network that spans over28 countries.
- The Consumer Attitudes to Savings Survey was first conductedin 2004 questioning adults (18+) in 11 countries, 16 countries in2005 and 21 countries in 2006.