Zarah ChoudharyReasearch by Standard Life, part of Phoenix Group, has found that younger generations feel more confident than older age groups that their pension will provide for their long-term retirement income needs, following the most recent Budget.
Since the Budget, more than a third (36%) of 18 to 34-year-olds said they feel more confident they will have sufficient income in retirement, compared to 10% of 35 to 54-year-olds and just 2% of over-55s.
In comparison, a third of these older generations felt less confident (32% of 35- to 54-year-olds, and 33% of over 55s).
Confidence was lower among women, with 36% feeling less confident in their pension providing for their retirement income needs, while only 9% feel more confident.
Meanwhile a quarter (24%) of men had less confidence, compared to 20% who were more confident.
Mike Ambery, retirement savings director at Standard Life, said: “There was a frenzy of speculation ahead of last month’s Budget about potential changes to pensions tax relief, allowances, the tax-free lump sum and a possible introduction of National Insurance on pension contributions – all of which had the potential to impact younger savers, and none of which materialised.
“The key announcement relating to pensions was that pensions would be brought into the scope of inheritance tax (IHT) from April 2027 – the effects of which will likely be felt by older generations more immediately as they plan to transfer their wealth to loved ones.
“It’s therefore perhaps unsurprising that older generations are feeling less confident than their younger counterparts about what their pension will provide for them in future.
“In time we could see more pensions accessed earlier to prevent them from becoming part of people’s IHT bill at a later date, and it seems older generations are already anticipating this.”
