Austerity bites for 41% without a pension

Research undertaken on behalf of F&C Investments suggests that 41% of adults in the UK have no pension provision, with nearly 48% also having no long-term savings they could draw on in retirement.

The survey, carried out by online market research specialist OnePoll.com in December, canvassed 3,000 adults from across the UK on a range of topics relating to the UK's economic position and their current and future financial plans.

Nearly two-thirds were very worried (13.83%) or slightly worried (50.94%) about losing their job, with the most worried being those aged 35-54 (70% of 35-44 year-olds and 45-54 year-olds being very or slightly worried). However, more than half said they had sufficient savings to cover their outgoings for at least a few months.

While 29% said they had no debts, the same number were worried about servicing the debts they did have, whether that was just a mortgage or more than one type of debt. Those aged 25-44 were the most worried about their debts, while more than half of over-55s were debt-free. Only 16% of that age group said their debts were a worry. Indeed, when asked what they would do with a £10,000 windfall, 43% of survey respondents said they would pay off debts or use it on day-to-day living expenses, although 25% would go on holiday.

Just one-third of respondents are currently contributing to an employer's or personal pension plan, with a further 22% having pensions to which they are not currently contributing. More than 57% of those not currently contributing to a pension said they could not afford to, a figure that rose to 64% among those aged 45-54.

While 30% of respondents said they had deposit accounts that could supplement their retirement income, just 4% are saving for the long-term in stocks and shares Individual Savings Accounts (ISAs). Buy-to-let property was a potential income-booster for just under 6% of respondents, spread fairly evenly across the age range.

Asked about their experience of the recent recession, 22% said it was the worst they could remember, although for a further 42.5% it was the first recession they had experienced as adults. Only 5% said they ‘don't know what all the fuss is about'

F&C Investments has produced a free Guide to Investing in an Age of Austerity, combining practical guidance on financial planning with an analysis of some of the investment areas that could actually benefit as a result of current global economic conditions. The Guide also contains information on F&C's range of investment trusts, which includes Foreign & Colonial Investment Trust, the world's oldest collective investment fund, set up in 1868. Investors can request a copy of the guide by calling 0800 136 420, or they can download an electronic copy at fandc.co.uk/austere.

Jason Hollands, Head of Corporate Affairs at F&C Investments, commented: "Although most people understand the principle that they are going to have to take more responsibility for their financial future, it is always worrying to see statistics like these that suggest so many people have still not made adequate provision for their retirement. While many will feel like they cannot afford to save today, putting it off until tomorrow will only exacerbate the problem."

Respondents to the survey said they felt the biggest risk to the global economy in the coming year was a double-dip recession in the West (30%) followed by the collapse of the Eurozone (26%). At a personal level, a 5% pay rise was the most popular choice for an instant boost to financial wellbeing (31%), though 21% said they would benefit most from lower fuel prices.