Britons relying on property to provide pension

| October 2, 2007 | 0 Comments

According to research from Baring Asset Management (Barings), 3.2 million Britons are depending on property investments to fund their retirement. Barings commented that this will leave them at risk of fluctuations in the UK property market and interest rate movements.

The research showed that 10% of 35-44 year olds are planning to fund their retirement with the income they receive from property assets, compared with 8% of 45-54 year olds and 6% of 25-34 year olds.

An additional 33% of UK adults are not currently making any provision for their retirement. Younger people in particular are not considering their financial future with one in three 25-34 year olds not having any kind of pension.

Furthermore, 23% of 35-54 year olds also do not have any plans for their retirement in place and worryingly, 22% of over 55 year olds do not have a pension in place.

Barings’ CIO, Marino Valensise, is encouraging people to make provisions for their retirement and commented that far too many people are dependant on property investments to fund their retirement. The CIO added that the events of the summer are showing through to the average UK consumer in the shape of higher borrowing costs and this will have an impact on the property market. A pension should be invested in diversified assets that are in accordance with your age, circumstances and number of years to retirement.

Barings concluded that it’s concerning that many are not thinking seriously about their financial future. The research shows that young people are delaying decisions about their pensions until they are older. Barings urge individuals to take a greater responsibility for their investments in order that their pension fund will grow to an adequate level by the time they reach retirement age.

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