Of those yet to retire are saving 11.4% of their annual income when they feel they should be saving 13.7%.
Two-thirds (66%) of retired investors wish they had saved more, including 22% who wish they had saved “a lot more”.
This is a trend that is prevalent across the countries surveyed and especially in Asia.
Investors yet to retire are saving 11.4% of their income which includes 9.9% in Europe, 13.0% in Asia and 12.5% in the Americas.
However, to live comfortably in retirement, respondents feel they should be saving an average of 12.0% in Europe, 15.3% in Asia and 15.0% in the Americas.
Lesley-Ann Morgan, global head of defined contribution and retirement at Schroders, said: “There’s a strong message from those who have already retired: I wish I had saved more.
“Our analysis shows that someone who started their retirement saving at age 30 would need to save around 15% a year if they wanted to retire on 50% of their salary at 60, the age at which they want to retire, according to our study.
“The most powerful tool available to savers is time. Start saving at an early age and it makes an incredible difference to the eventual size of your retirement pot. The miracle of compounding, where you earn returns on your returns, adds up over 30 or 40 years of saving.”
At retirement
One way in which investors could save more is to work for longer. When asked at what age they wanted to retire and at what age they realistically expected to retire, investors said they wanted to retire at an average age of 60-years-old, but realistically expect to retire at 63.
63% are hoping to work part time, for an average of 3.4 years before fully retiring. Also, 30% want to turn their hobby into a source of income when they retire.
How do millennials compare?
The feeling of not currently saving enough for retirement is most prevalent among millennials. On average, compared to older non-retired investors, millennials save slightly less (11.2% vs. 11.6%) of their income specifically for retirement, and to live comfortably in retirement, they feel they should be saving an average of 13.2% – slightly less than older non-retired investors who feel they should be saving (14.1%).
When it comes to how millennials differ from older generations in how they are going about saving for their pension, millennials feel sources of retirement income will be mixed, but they are less likely to be reliant on:
- other savings (19% vs. 21%)
- They feel they are more likely than the older generations to be reliant on various other sources of retirement funds, like:
- part-time job (7% vs. 5%)
- income from property (9% vs. 6%)
- releasing home equity (6% vs. 3%)
- money/allowance from a relative (10% vs. 5%)
- or inheritance (6% vs. 4%)
