Retirement planning is a critical, yet often daunting, aspect of personal finance. It’s a journey that everyone will embark on at some point in their lives, however many people find themselves feeling unprepared.
The complexity of retirement planning, coupled with the many savings products that are available, can make the process overwhelming. But understanding its importance and taking proactive steps can turn this challenge into a manageable and even empowering experience.
The recent “Building Your Retirement” webinar, hosted by Schroders Personal Wealth (SPW) and with insights from financial planning professionals, shared valuable knowledge to help prepare effectively for a comfortable retirement and peace of mind.
The reality of retirement anxiety
Retirement anxiety is a common and understandable concern, as the prospect of transitioning from a steady, employer-supplied income to relying on savings can be daunting.
According to SPW’s retirement survey conducted in May 2024, nearly one-fifth (18%) of respondents were not confident at all in their current retirement plan and more than half (51.8%) were concerned about not having enough money in retirement to live the level of comfort they desire.
“Retirement should be an exciting moment for all of us, a time to stop working and enjoy the benefits of our hard-earned pension and any other retirement pots,” said Leigh Dunkley, SPW’s Head of Strategic Partnerships, who hosted the webinar.
“Sadly, that’s not the case for many of us, and it’s exactly that reality that we’re trying to change.”
Elle Gedge, Personal Wealth Adviser at SPW, emphasised that these concerns are universal.
“It's absolutely a huge concern for clients of all ages, male and female," she said. For younger clients, the uncertainty of the future and the state pension age is a major worry. Older clients, meanwhile, often feel it’s too late to make significant changes to their retirement plans.
Gedge stressed the importance of exploring individual retirement goals and preparing accordingly.
She said: "Everyone has a different idea of what 'retirement' looks like for them – some people want to go on world cruises, while others can't wait for some time to be spent at home, slowing down a little bit and living a quieter life. There is absolutely no wrong answer, but the key is to be prepared, to have financial freedom and peace of mind.”
Importance of early and consistent savings
One of the critical takeaways from the webinar was the importance of starting to save for retirement as early as possible.
Justin Blower, Regional Director at SPW, addressed the common hesitation to invest in the stock market due to perceived risks, explaining that “avoiding investing may be riskier in the long run”.
He explained: “While it may seem safer to keep your savings in low-risk, easily accessible accounts, these often fail to keep pace with inflation. By contrast, investing exposes savings to shorter-term market fluctuations but tends to generate higher returns over the long term.”
Of course, the value of investments and the income from them can fall as well as rise and is not guaranteed. You may get back less than you invest.
Gedge noted that younger savers typically have more flexibility, allowing them to have a greater say in the kind of retirement they want.
“When you’re younger, so many doors are open to you. You have the opportunity to decide what you want your retirement to look like,” she said.
“Saving into a pension doesn’t always feel like a priority when you have so long left of your working life, but it’s important to consider the bigger picture – where you are now and where you want to be.”
A gendered view
While retirement anxiety is prevalent across the population, women are more likely to face a pension savings gap.
Research from Scottish Widows indicates women face an average pension gap of £100,000 by the end of their working lives. This is due to several interrelated factors: the gender pay gap (UK women earn 7.7% less than men, according to government data) childrearing and irregular working patterns, such as part-time work and career breaks.
“From government policy to employer duty to personal responsibility, there’s a lot at play here,” said Susan Hope, IFA Workplace Senior Manager at Scottish Widows.
“But crucially, it’s not just about women; it's about our partners, fathers, bosses and sons too. Together, we need to start having conversations to ensure that, when women take time off for family, there's a solid retirement plan in place for everyone involved."
Blower also pointed out the role of unconscious bias in financial advice, which may make the industry less approachable for women.
“Sometimes, the language used in financial planning may be unintentionally geared towards men," he said.
“We need to work harder as an industry to make our advice more inclusive and supportive of women’s financial journeys.”
Simplifying retirement planning
The panel also discussed the complexity of retirement planning and the need for simplification.
“We live in a world where we have more information than ever at our fingertips, but all that information makes it hard to understand what we need to do to achieve a comfortable retirement,” Blower said.
“It's really important that we start to make these topics more understandable, remove some of the jargon and the difficult language.”
Gedge stressed the importance of personalised financial advice from a trusted source.
“Like in any industry where trust and transparency are paramount, finding the right financial adviser can completely change your perspective,” she said.
“They provide the knowledge, time and confidence to help you navigate your financial decisions.”
The seminar was undoubtedly useful, with the number of attendees who said they felt confident about retirement increasing by 44% over the course of the event.
But for those who missed it, the key takeaways were clear: start planning early, seek professional advice and stay informed about your financial options.
As Hope aptly put it: "Retirement should be an exciting milestone, not a time to worry about money. With the right preparation and support, it can be just that."
