New research from online pension advice experts, Wealth Wizards, indicates that the ‘sandwich generation’ of Brits caught between looking after both the younger and older generation may be sacrificing their own financial security in order to financially support the generations on either side of them. Input from Phil Blows, Director, Wealth Wizards.
Of UK parents, two thirds (66 percent) reported that if they had any spare income they would be more likely to save it to help their children to get onto the property ladder than put it into their retirement fund. Thus just under half (46 percent) cannot see themselves saving enough for a pension until their children leave home. A further thirty-two percent financially support both their children and parent(s) and the same amount (with parents still living) cannot see themselves saving enough for a pension until their parents pass away. Over a quarter (26 percent) feel financially squeezed, having to support their direct family and either do or will need to support their parents in the future.
As a result, thirty-eight percent are concerned that they will be a financial burden on their children in the future as they currently do not have enough of a pension fund. It is therefore unsurprising that for just under a quarter (23 percent) this concern sits in parallel to the worry that they will (or already do) have to support their own parents in retirement and wish that their parents had planned better for their future.
Phil Blows, Director, Wealth Wizards said: “There can be no doubt that in today’s economic climate, reaching a state of financial security, is no easy feat. Getting that first foot on the property ladder is for many completely out of the question without the support of parents or an inheritance. The cost of living, of education and even healthcare consistently increases and those who are caught between supporting two generations, as well as themselves, have it harder than most.
“It is important for those who find themselves in this position to do what they can to break the cycle. While looking after their loved ones is of course a priority, it is important that they also make provision for their own retirement, in order to avoid presenting the same dilemma to the next generation. Luckily, digital advice solutions are available that can help individuals take stock of their own incomings and outgoings and receive advice on how best to use any surplus. This could be through investing in a work place pension scheme, ISA, property or other investments and to take advantage of what help is on offer from the government or from employers. Technology has changed the way financial advice is delivered and it has never been simpler or more affordable to get the help people need”,
The research was conducted by Populus for Wealth Wizards in May 2017 with a representative sample of 2,000 people.
