Norwich Union warns against a nation of retirement regretters

As Britain's savings rate hits its lowest level for 50 years, Norwich Union, part of Aviva, is warning young people that they shouldn't let the credit crunch stop them considering their financial futures now - or they may face regrets in retirement.

A new study from the investments and pensions specialist shows that the cost of many household items has risen by more than 20 times in the last 50 years, and predicts that today's 20 and 30-somethings could be facing a four-figure average weekly shopping bill in another half century, if the trend continues.

According to these calculations, 2058 could see a pint of milk cost around £5.35, while a loaf of white bread could set shoppers back more than £27. A kilo of potatoes could cost nearly £13, while smokers could be stumping up more than £76 for a packet of 20 cigarettes.

Norwich Union found further typical 2058 grocery bills could look something like this:

Butter (250g) £14.13
Flour (1.5kg) £10.63
Pork (loin, kg) £67.32
Cheddar cheese (500g) £98.43
Eggs (a dozen size 2) £31.22
Instant coffee (100g) £21.23
Sugar (granulated, kg) £10.08
Apples (kg) £24.20
Pint of bitter £57.98

And although house prices have fallen in recent months, overall the increase since 1958 is huge. So much so that those buying a house in 2058 could be looking at prices in excess of £12.2 million for the average des-res!

Paul Goodwin, Head of Marketing, Corporate and Pensions for Norwich Union says: "These predictions for the future may seem extreme, but the fact remains that many household expenses have risen by 10 or 20 times or more in the last 50 years, so it's perfectly possible that the same could happen again in another 50 years' time.

"As the credit crunch bites, most people are focused on short term savings, but it's important that they also start thinking about their long term futures, even if they are only putting away a small amount each month.

"As a rule of thumb, the sooner people start saving towards their future, through a pension or investment product, the more comfortable they can expect their later years to be. So those who start saving early can expect to reap the rewards in retirement."
Norwich Union, part of Aviva, is a leading provider of pensions, investments and insurance products.