Brits Hope to Retire Early Despite Pensions

Although Britons - on the whole - are not saving enough for their pensions, more and more hope to retire early, thanks to their own efforts.

A new survey shows that British workers are more optimistic about when they might retire than their fellow Europeans, with 27 per cent expecting to retire before age 60. That compares to just eight per cent of Germans.

At the same time, while 33 per cent of Brits think they may have to work beyond 65 to afford a decent retirement, that figure is 47 per cent in welfare-heavy Germany.

The study has been produced by communications agency Brahm and financial services firm Cicero Consulting, and it shows that the message that the state will not provide for all one's needs in retirement is getting across.

Only 17 per cent of British workers expect the state pension to make up three quarters or more of their retirement income, compared to 64 per cent in Spain and 41 per cent in France.

"People are starting to understand that retirement at 65 is not a given and are open to new approaches to their working and retirement life", Robin Horsfield, associate director and head of research at Brahm, explained.

Indeed, former work and pensions secretary David Blunkett suggested that the state retirement age may have to rise to 67.

A few days later, the National Association of Pensions Funds put forward 69 as a possible age.

This survey suggests that the vast majority are prepared for this eventuality. Only one in nine respondents from across Europe refused to consider the possibility of working longer to secure better state benefits.

"The results of this research provide policymakers across the EU with important clues suggesting - given the right conditions - people are prepared to work longer in order to secure a better retirement income", Iain Anderson of Cicero stated.

The report of the Pensions Commission - headed by Adair Turner - is due in November. This will put forward proposals for addressing Britain's long-term pensions problem.

In its interim report, the Commission put the size of the pensions "black hole" at around £95 billion, but studies this summer have put the figure closer to £130 billion.

A June report from the Association of Consulting Actuaries found that 89 per cent of companies offering a final salary pension scheme will not have the funds to pay for it.

So what does this new study show? Either that the public has got the message, and acknowledges that it cannot expect the state to provide for it any more, or that some people are well on their way to getting to grips with the new reality.

Of course, it could mean that everyone is simply failing to admit what all the economic evidence has been pointing to for years now.

But who is going to bite the bullet and come up with a solution? Everyone in the country - young and old alike - should be waiting with bated breath for Adair Turner's imminent findings.