Economic uncertainty is a key concern for more than a third (34 per cent) of people when it comes to their ability to save for their retirement, according to new research from Close Brothers Asset Management.
Brexit appears to be taking its toll on financial security already, with 30 per cent of British adults revealing that they are specifically worried about political uncertainty in the UK/Europe and how this will impact their retirement saving.
The research, which was carried out by YouGov, reveals that 11 per cent of adults are likely to increase the frequency with which they receive financial advice since the UK voted to leave the EU as they look to ensure that they are financially prepared for the possibility of bumpy years ahead.
The findings also show that one in five (21 per cent) British adults are changing their investment strategy in reaction to Brexit. Around one in seven (15 per cent) plan to be more conservative and take fewer risks following the Brexit vote, with three per cent planning to increase their risk exposure.
Not only is economic uncertainty undermining people’s ability to save, but it is revealed to be the biggest concern for people when it comes to making sure their money lasts long enough in retirement. A quarter (26 per cent) of British adults cited economic uncertainty as their biggest concern in making money last once retired, while a fifth (21 per cent) cited living longer than the period saved for, and around one in ten (nine per cent) cited the prospect of higher taxes when accessing pension pots.
David Newman, head of pensions at Close Brothers Asset Management says, ‘It is clear that the British public is very concerned by the prevailing economic uncertainty, and the impact it will have on their finances, and Brexit remains a big driver of this worry. Many are taking a more conservative investment approach to their long-term savings as a result. However, being too conservative can pose just as great a risk as taking on too much risk, reducing the potential for long-term returns and chances of meeting goals for retirement. A sound, long-term investment strategy is vital, with diversification across different assets and markets, to alleviate worries over short-term volatility.
‘Engaging with your finances can seem time consuming and confusing, but working with a financial adviser who understands your goals will mean that you can plan far better for funding retirement, and help provide peace of mind during times of uncertainty.’