Self-employed struggle to save for retirement
24 June 2014
More than two-fifths of self-employed people have no retirement savings, research by Prudential has revealed.
The survey of more than 2,200 people found that 43% of self-employed people are without a pension while just 17% regularly contribute to one.
The main reasons for not saving into a pension:
- 57% said they cannot afford to save into a pension
- 16% said they have chosen not to save into pensions, or are planning to use their business to fund their retirement
- 9% reinvest spare money back into their business instead of saving
- 6% don't expect to stop working.
When asked about their future saving plans:
- 52% said they don't have plans to start or resume saving into a private pension
- 27% will start or restart their retirement saving a fifth said they didn't know.
Stan Russell, retirement income expert at Prudential, said:
"The financial pressures of starting and growing a business often means that spare cash is hard to come by.
"Focusing on day-to-day finances is second-nature for those who are self-employed. However, not considering or planning for the longer-term is a risky approach, especially if those who own their own businesses don't want to end up having to work past their ideal retirement age."
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