Cost-of-living crisis is increasing ‘retirement anxiety’

A fifth of Brits are losing sleep due to worrying about retirement

Nearly two thirds (58%) of UK adults aged 40 and over are anxious about retiring, research from Abrdn has revealed.

This is up from 54% in 2022.

A fifth (20%) admitted that they are very anxious about the prospect of retirement, representing a 70% increase on 2022’s figures (12%). Around a fifth (18%) said that their anxiety is severe enough to keep them awake at night and 11% said that it is affecting their personal life and relationships.

More than two fifths (43%) of those surveyed said that their retirement anxiety was driven by not having saved enough to be able to afford to retire. Nearly four-in-10 (39%) reported that they are worried about the impact of the rising cost of living on their retirement plans.

Almost a quarter (24%) are worried about how the current economy will affect their investments and pension, and over a quarter are embarrassed about not having started to plan earlier (27%).  Other causes of anxiety included being worried about being pigeonholed as old (17%) and losing their identity when they stop working (14%).

Abrdn’s research also found that more than one in eight (13%) have delayed retirement plans as a result of feeling anxious, increasing to 18% for those aged 55 and over.

It also revealed that respondents had three main concerns about retiring: not having enough money to last throughout retirement (39%): not being able to afford to do the things they want to do (33%); and how to save for retirement while still having enough money to live on now (29%). In addition, the survey highlighted that almost half (41%) of respondents have done nothing to prepare for retirement.

Shona Lowe, financial planning expert at Abrdn, said: “The prospect of retiring can be a daunting one, whatever your age, particularly against a backdrop of rising interest rates, high inflation levels and an ongoing cost-of-living crisis.

“It is completely normal to experience anxiety about retirement; you’re gearing up for a big change that has a number of variables and factors to take into consideration. But it is concerning to see an increase in the number of people that are experiencing retirement anxiety in our latest research, and to find that for some, the level of that anxiety is affecting their ability to sleep and their relationships.”

Source: International Advisor