Despite the introduction of Pension Freedom, new research has revealed that millions of people will only have a financially comfortable retirement if they receive an inheritance.
The research, which surveyed 2,000 people, of which 25% have already retired, was conducted for the pension provider, LV=. It found that 35% of working people are reliant on receiving an inheritance to secure a financially stable retirement.
At the same time 20% of people surveyed, who are still working, won’t be able to comfortably retire without receiving an inheritance.
However, results also show that many of those people still in work may well be disappointed with what they receive. A quarter of those people who have already retired said they plan to leave nothing to their heirs, whilst 28% of people don’t expect to leave much to their children.
Inheritance to fund retirement
Whilst only 16% of people said that they would directly use an inheritance to fund their retirement, for example by making a pension contribution, others said they would repay their mortgage or unsecured debt, thereby reducing their outgoings and increasing their ability to retire.
Commenting on the figures John Perks, Managing Director of LV= Retirement Solutions, said: “People now spend almost as long in retirement as they do in the workplace, so it’s worrying to see that many people say they are reliant on something essentially out of their control to provide them with a comfortable retirement. With all the everyday demands on our time, retirement planning is often at the bottom of the to-do list, but it is important that people take steps to secure themselves the lifestyle they hope for in retirement. We would encourage people approaching retirement to seek advice to get the most out of their pension savings.” (Source: LV=)