Wishing for something and planning for it to happen are two very different things. But, as Eleanor Roosevelt said, “it takes as much energy to wish as it does to plan.”
We might for instance wish for a world where everyone enjoys the retirement they want, but the reality is despite the UK having one of the largest pension and long-term savings systems in Europe*, people across the country are still falling short when it comes to planning for their futures.
Financial Planning Week is a timely reminder that a secure retirement isn’t built on wishes; it’s built on plans.
The statistics are sobering*:
- 17 million adults in the UK aren’t saving enough for retirement.
- Only 3% of millennial households with median income are projected to achieve a “moderate” retirement standard of living (based on the PLSA’s Retirement Living Standards).
- The UK’s pension savings gap is expected to surge from £6 trillion to £25 trillion by 2050, according to the World Economic Forum.
What’s holding us back?
Three core challenges hinder progress toward better retirement outcomes:
- Low saver engagement: Apathy or confusion about retirement planning prevents many from taking proactive steps. An “it’s too late now” mindset is also restrictive.
- Low standards of living for retirees: Many face financial struggles after a lifetime of work, with savings being affected by the rising cost of living, financial downturns and times where rising inflation has outstripped wages.
- Low productivity of long-term savings: Even those saving diligently may not see their money grow effectively, either through low interest rates, or from poor returns from investments.
Planning for a better future
Wishing for change isn’t enough. The solution lies in action and planning. Mercer’s recent paper, “UK DC – Key themes & opportunities for 2025”, outlines a clear plan of action to address these challenges and bridge the pension savings gap. It focuses on practical, impactful solutions:
- How to boost retirement income: Creating systems that ensure retirees can achieve a better standard of living.
- Improving investment outcomes: Growing long-term savings through smarter financial strategies.
- Supporting people to save: Empowering people with the tools, knowledge and confidence they need to take charge of their financial future.
Helping people to help themselves
Financial Planning Week is the perfect time to take stock of your financial health and start planning. Whether you’re just beginning your savings journey or looking to refine your strategy, remember: the energy you spend planning today pays dividends for years to come and it’s never too late to start saving. Or, as Eleanor Roosevelt might say, “you can often change your circumstances by changing your attitude.”