Half of over 45s not saving for retirement

Almost half (47%) over-45s are not saving for their retirement, and furthermore, those who are saving are not taking advantage of the tax breaks offered by using ISAs, according to research from M&S Money.

As the end of the tax year approaches, M&S Money surveyed more than 1,000 people over the age of 45 to find out how they are planning to save for their retirement.

The findings show that of those who are planning for retirement, the majority are not taking advantage of tax-free ISAs to help boost their retirement savings. Two thirds (66%) of over 45s are not saving into Cash ISAs while more than eight in ten (84%) are not saving into Stocks & Shares ISAs.

For those who do save into ISAs, over half (52%) admit they have not saved the full tax allowance this year, while just 30% of people plan to save the full tax allowance of £10,200 by the April 5th deadline.

The total average amount held in Cash ISAs for those who have saved is £18,334 - almost £21,000 less than the total possible allowance of £39,300 since they were launched in 1999. The average amount this age group has saved in their Stocks and Shares ISAs is slightly higher at £19,077; however this is £68,500 less than the maximum £87,600 they could have saved to date.

Based on average Cash ISA rates over the past eleven years and using the full Cash ISA allowance each year, savers could have earned an additional £7,931 in interest.

Colin Kersley, Chief Executive of M&S Money commented: "The news agenda has been dominated with proposed changes to pensions over the past few months, and people approaching retirement need to ensure that they have sufficient savings to provide an adequate income for themselves.

"It is of utmost importance that people of all ages are saving and planning for retirement, but even more so for those who are approaching this stage in life. Taking advantage of the tax breaks of ISAs is one way that savers can help to boost their retirement savings."

M&S Money offers a range of Cash ISA options. Customers can choose from fixed or variable rate savings option, or they can divide their tax-free savings between the two.

For more information, visit marksandspencer.com.