55 is peak age when retirement planning advice becomes a priority

The peak age for retirement planning becoming an advice priority is 55, a new study by St James’s Place (SJP) has revealed.

The study, which surveyed just under 12,000 individuals, found that the top three advice priorities were retirement planning advice, general investment and savings advice, and better budgeting.

However, there is a large generational divide, as cost of living and budgeting see younger generations push retirement planning down the line. Only one in ten (12%) Gen Z and two in five Millennials name it as an advice priority in the next six months.

The study found that 1 in 5 people (19%) would find retirement planning advice the most beneficial in the next six months, ahead of general investment and savings advice (17%) and budgeting (14%). Other priorities include:

• Wills planning – 13%

• Putting an overall financial plan in place – 11%

• Keeping my financial plan on track– 11%

• Getting a better mortgage deal – 10%

• Inheritance & estate planning – 10%

While retirement planning is the top advice priority overall, it most often becomes a major focus only later in life, leaving less time to improve retirement outcomes.

Almost a third (30%) of Gen X (44- to 59-year-olds) name retirement planning as their advice priority for the next six months. However, it falls much further down the rankings for Millennials (28- to 43-year-olds) and Gen Z (18- to 2- year-olds).

SJP’s analysis demonstrated the difference that retirement planning earlier in life can make to retirement outcomes.

It found that if a 30-year-old made a gross investment of £5,000 each year into a pension scheme, they would have a projected fund of £268,000 available at the age of 60.

However, just a five-year delay would result in a £67,000 reduction to that retirement fund, and a fifteen-year delay, starting contributions at age 45, would reduce it by £169,000.

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