Over-60s aren’t confident about readiness for later life costs despite feeling financially ‘well prepared’, Just Group has found.
Some seven in 10 over-60s said they feel financially well prepared for retirement but many still lack confidence about the size of their pensions, meeting future care costs and ability to leave an inheritance.
Stephen Lowe, group communications director, Just Group, said: “It’s surprising that many of those nearing the end of their working lives who say they feel financially well prepared also told us they don’t feel they have sufficient savings for retirement, inheritance or care costs.
“While around six in 10 do feel able to maintain their lifestyle for a while, far fewer feel confident about the longer-term financial realities of the retirement years.”
Some 72% of those aged 60-69 and 77% of those aged 70+ said they felt financially well prepared, significantly higher than younger age groups.
The majority of over-60s who felt well prepared said it was because they can maintain their current lifestyle for the foreseeable future.
However, only four in 10 said it was because they had sufficient savings for retirement, three in 10 said it was because they were confident of leaving an inheritance, and less than two in 10 said it was because they could cover future care costs.
Those who own homes are more likely to feel financially well prepared with 78% of those who own outright and 60% of those who own with a mortgage feeling well prepared, compared to 42% of those renting privately and 38% in social renting homes.
And those who own property feel more prepared in terms of pensions, inheritance and care costs than those who rent.
Lowe added: “Home ownership gives people more confidence around meeting these longer-term financial challenges, most likely because they know they can access the property wealth if needed.
“This is a factor driving the strong growth in the equity release market. Homeowners who feel financially well prepared and generally optimistic about maintaining their current lifestyle into retirement are often pessimistic – or perhaps realistic – about having sufficient pension savings.
“People now have more responsibility for making decisions in how to use their pension savings and many are choosing to access pension cash at much earlier ages.
“Homeowners have the safety net of knowing they can access the equity in their property to top-up their pension savings in later life, and data from the Equity Release Council shows increasing numbers of people are choosing to do so.”