Advice is critical to babyboomer retirement
The AXA Wealth survey of babyboomers (those aged 45 – 65) shows that the average intended retirement age is 64 years old, slightly below the national retirement age. Furthermore, more than seven out of ten optimistic babyboomers (73%) have not delayed retirement due to the recession, and a breakdown of the survey findings show that this is the case across all age ranges and wealth segmentations.
However, Britain’s babyboomers recognise that they will need to find ways of funding retirement and over a third will rely on property to help them do so. The survey found that:
- Nearly three quarters (73%) of babyboomers are not delaying retirement due to the recession
- Almost 1 in 2 babyboomers will rely on some form of property income to fund retirement
- 1 in 4 expect part of their retirement income from downsizing property
- Almost 1 in 10 expect to free up cash using equity release
- Almost 1 in 10 expect to use rental or other income from a second home
- 5% of babyboomers expect the sale of a second home to help finance retirement.
“The survey shows a certain ‘Zeitgeist’,” said David Thompson, MD of wealth investments and distribution, AXA Wealth. “The property market could witness a glut of properties coming onto the market in the next 10 – 15 years, corresponding with a massive hunt for cheaper rural houses. This will have a significant impact on the UK housing market. IFAs have a critical role to play in helping their clients understand what is realistic in terms of planning for their financial future and understanding what sort of income they can expect from their property.”
The survey also pointed to a trend for babyboomers seeking a lifestyle change in retirement; around one in three expect to move house at the point of retirement, with the majority listing a “lifestyle change” such as moving to the countryside, seaside, or seeking a move abroad. Younger babyboomers would appear most likely to seek such a move; more than 1 in 2 (56%) of those aged 45 – 49 years expect that a property move would be due to seeking a lifestyle change such as a move abroad.