Lawyers in the dark on retirement income needs
01 Dec, 2014
- 79% of lawyers don’t know how much income they will have in retirement
- More than a quarter are planning to work past their retirement age
- 70% of lawyers fear they won’t have enough to live comfortably in retirement.
Nearly three quarters (70%) of lawyers are worried they will not be able to adequately fund their retirement, according to new research from Wesleyan, the specialist financial services provider for lawyers.*
70% of lawyers fear they won’t have enough to live comfortably in retirement. On average, they thought they would need £35,680 a year to live on. However, 79% didn’t know how much income their current pension arrangements would generate.
Just under a fifth (19%) of lawyers said they were planning to retire early, down from 29% in 2011**, and more than a quarter (26%) felt they would have to work past their retirement age. Only 30% were relying just on a pension for retirement income, with one in six (17%) planning to use the equity in their property for additional financial support.
The research also found that 44% of lawyers reviewed their retirement planning less than once a year and of those more than half either couldn’t remember the last time they reviewed their plans, or hadn’t done so since joining their pension scheme.
The results come as Wesleyan launches a new service for law firms to support them with all aspects of their increasingly complex financial planning arrangements, including auto enrolment.
Its team of financial experts will work with finance directors and senior partners to understand a firm’s commercial requirements building a tailored portfolio of solutions that can include professional indemnity insurance (PII), cash flow funding and business continuity. The firms’ employees will also be able to access one-to-one advice with a financial consultant to discuss their own personal finances.
Samantha Porter, Wesleyan’s Group Sales and Marketing Director, said: “The key to a successful retirement is planning ahead. Lawyers should think about the kind of lifestyle they want in retirement and how much income they will need to finance that. Once they have a plan in place they should review it at least annually.
“There has been a raft of changes in the pensions environment in recent years and these could all impact final retirement income.
“People often overestimate how much cash they will need in retirement but they really should understand how much income their pension plans will generate.”
Wesleyan is a mutual financial services provider working with doctors, dentists, lawyers and teachers.