People Saving Less For Their Pensions, Insurer Claims

Many Britons are cutting down on the amount they are saving for their pensions, Prudential suggested today.

According to the insurance firm, tightening budgets due to the credit crunch and rising prices have led people to prioritise how they spend their money to avoid falling into debt - with retirement savings suffering as a result.

Moreover, Prudential said that not saving enough in pension plans is a major cause of concern among working-age adults. Recent research from the firm shows that 37 percent are "losing sleep" over their lack of savings, while only 27 percent are saving enough to maintain their standard of living when they finish work.

Commenting on these trends, Julie Mulvanny, head of business development for individual pensions at Prudential, also said that recent house price falls have also had an effect on the way in which people are thinking about their pensions.

"What we have had in the past is people very much relying on their houses for their pensions despite the fact that [only] ten per cent of people have houses with enough value to provide a decent amount of income through things like equity release and downsizing…people are aware of this; I think it's a major issue for a lot of people," she said.

"If you're saving for your pension that seems a long way off if you are struggling to just pay your mortgage and pay the bills in general, I think pensions are an easy one to stop making your payments to."