People need to start planning for their pensions more earnestly, as current trends show that the average working age will increase into people's 70s to save enough for retirement. The current average pension pot of around £64,000 is only a fraction of the £273,000 estimated to provide a weekly income equivalent to the state pension. Individuals need to invest their money rather than just save, to help build larger pension funds. Younger generations like millennials are especially vulnerable, as they have the lowest incomes historically and high debt, putting their financial security in old age at risk. The article provides tips for starting to invest, such as understanding common myths, setting goals, and doing initial research online or with financial advisors.

1. WMA Blog: Investing for your future
9th March 2016
Why people should think about their pensions and how can they go about it
As the new Tax Year approaches, you might want to take the opportunity to do some spring cleaning and make some
resolutions. We all know the importance of preparing for a rainy day, but most of us struggle building a decent sized
nest egg. Are we thinking about investing our money so that it works harder rather than sitting earning little in a low
interest current account?
It is now thought that the working population will have to work up until their 70s to save for their pensions and as the
population ages it may become increasingly necessary to work longer. Unfortunately, those who would have been
paying into their national insurance with a view to claiming their state pension won’t be able to enjoy an annuity larger
than £7500. This will impact their current quality of life and lifestyle. Indeed, to enjoy the equivalent to the £151.25-a-
week state pension at retirement, one would need to have a pension pot worth £273,000, yet the current average for
people approaching pension is just £63,815 , a mere fraction of what is needed to ensure financial security in old-age.
People must start planning for their future in earnest, and what better time than now to begin? To achieve this and
build a significant pension pot through traditional saving won’t be enough; it will be necessary for people to start
investing and as a country we should shift from a culture of reliance on government provisions to a culture of
investment and savings that allows individuals’ independence in their forward planning.
Many of us feel in the dark when it comes to these issues, but there is actually a lot of information available. It is an
issue for all of us, but as the working age increases the young are one of the most vulnerable demographics. This
rings most true for millennials (the current generation aged between 15 and 35 years), of which 92 million are
approaching home-buying age. According to recent Goldman Sachs research millennials today have the lowest share
of the median income in history and started adult life with the highest levels of debt. They potentially will be the first
generation that will be worse off than their parents. This constitutes both an opportunity and a challenge for the
wealth management industry, which will have to provide support and help grow millennials’ wealth for a comfortable
future.
So how do we start?
To get more of the population investing, it is important to break many of the myths around investment, such as it is
“only for the rich” or that it is “too complicated” – investment can be a viable option for us all. It can become part and
parcel of everyday life to plan for your future savings – building your nest egg to help achieve your future ambitions in
goals in life, be that the ability to send your children to university or paying for a dream cruise after you retire.
Ask yourself today, “what do I want to achieve?” “What could some prudent investment now provide me with in the
future?” If you want to do some online research you could start by visiting websites like the Money Advice
Service and Investopedia, or have a look through investment publications such Investors Chronicle or the numerous
money pages in national newspapers. The WMA also runs an online directory of member firms that provide a myriad
of services from execution only to advisory and discretionary wealth management so you could start your
conversation today. If you are unsure of some of the terminology you can also refer to our Jargon Buster.
Investment is a journey for us all – we all have different situations, requirements, needs, wants and attitudes to
risk. Whatever your goals are and no matter what changes throughout your life, it is important to constantly re-
evaluate how you are planning for your future and think how you can make your hard earned money work harder for
you.
Notes for Editors
[1] http://www.theguardian.com/society/2015/nov/29/five-ways-work-will-change-future-of-workplace-ai-cloud-
retirement-remote
[2] http://citywire.co.uk/money/buy-more-state-pension-at-half-the-cost-of-an-annuity/a742016
[3] http://www.express.co.uk/news/uk/600250/Pension-SHOCK-millions-Experts-say-we-must-all-work-longer