Research show the majority of Scots now preparing adequately for retirement.
More than half of Scots are now saving adequately for retirement according to the 10th Scottish Widows Retirement Report, as the impact of auto-enrolment and improvements in the wider economic environment begin to take effect.
55% of the population were found to be saving adequately in this year’s report, a year-on-year rise of 7 percentage points, and 2 percentage points higher than the national average of 53%.
The monthly amount Scots are saving towards retirement has also increased by 133% from £51 in 2007 to £119 in 2014, and the total amount people in Scotland have in savings and investments has risen from £25,369 per person in 2013 to £36,243, £2,565 more than the national average of £33,678.
Nationwide, auto-enrolment is playing an important role in increasing the number of people preparing adequately for retirement, with the average proportion of earnings put aside in companies with 250 staff or more across the whole of the UK increasing from 9.7% to 11.6%. This is almost 4 percentage points more than the minimum required amount of 8% of earnings, showing people are increasingly understanding the importance of long-term savings for retirement.
Improving attitudes towards finances and the wider economy have also played their role, with 36% of people in Scotland saying they felt optimistic about their long term finances compared to 30% in 2013.
The proportion of people in Scotland who cite affordability as a reason why they don’t plan to save any more over the next 12 months also continued to fall from 66% in 2012, to 65% in 2013 and 61% in 2014.
There is however still some way to go. One in three Scottish people (36%) say that they have no idea of the extent to which their pensions, savings and investments will meet their retirement income needs. A third (36%) of Scottish people do not believe they will be better prepared for their retirement than their parents were.
Ian Naismith, Pensions Expert at Scottish Widows said:
"A decade of tracking retirement savings trends has shown us the impact that events such as the recession, auto-enrolment and the recent Budget announcements have had on Scotland's savings behaviour. It is heartening to see that finally Scots are starting to sit up and take notice of the importance of planning for the future – whether this be through proactively upping their contributions due to a more favourable economic climate, or starting to make plans for their retirement for the first time thanks to auto-enrolment.
"Although we have undoubtedly made some significant strides forward since our research first began, there are still some groups who are not preparing adequately for a comfortable later life and are at risk of slipping through the net. While celebrating the success of the wider savings picture, we must not forget to identify and support these at-risk groups, such as the self-employed or part time workers, to make sure they too have a plan for securing their financial future and do not get left behind."
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