Almost half of UK parents are now urging their children to make pension planning a priority, according to a new survey by Aviva.
While 47% of parents wish to persuade their children to save into personal or company pensions, a third (36%) would actually contribute cash as a ‘kickstart’ for their children’s pensions planning.
Hard lessons appear to have been learned from the property downturn as well, Aviva reveals. Three quarters (76%) of homeowner parents are now advising their children that property ownership alone is too risky as a pension planning strategy. Their pension advice is not to rely solely on property, but to supplement this with structured pension planning and pensions saving.
Over half of parents surveyed, again perhaps disillusioned with their fortunes as property owners, believed the UK is too obsessed with getting on to the property ladder.
Parents appear to be pushing their children towards taking pensions advice, with 88% declaring they are worried about their child’s financial futures. For 7 out of 10 parents, there is a fear that the Basic State Pension may no longer exist, by the time their children reach retirement.
Other parents worry that a lack of pension planning could mean that their children will have to work beyond retirement age (60%), be unable to afford to pay their bills when they stop working (45%), or suffer health problems as a result of working longer (29%).
Furthermore, 11% of parents stated that they are warning their children not to make the same mistakes they did, by becoming over-reliant on property values in their pensions planning.
Of those homeowners who admit to having put their pension planning on the back burner, and have not yet taken pensions advice or set up a pension, 40% claim the economic downturn has prompted them to think about pensions advice and investing into a pension.
Property expert Sofie Allsop, who worked with Aviva on analysing the research, said: “Bricks and mortar are a good investment, but the recession has served us with a painful wake-up call that property values can go down as well as up. Parents are right to urge kids to climb both the pensions ladder and the property ladder.”
