Pension saving can make up only a component of the money people put away for retirement, with many choosing savings and investments as alternative sources of income. However, many Britons have been knocked for six as a result of the ongoing COVID-19 pandemic, leaving their plans for retirement in tatters. Research undertaken by Standard Life has shown a third of over 55s nearing retirement believe the pandemic has made them more cautious with their savings and investments.
COVID-19 has undoubtedly caused chaos in many sectors, but it is financial stability which is under threat for significant numbers of people, causing stress and strain.
More than a quarter of over 55s asked said losing value off their savings and investments as a result of COVID-19 is now their biggest financial concern.
An additional quarter of over 55s who are approaching their retirement focused on their pension savings.
These individuals were worried about the pandemic’s impact on their pension pot, and cited this as their biggest financial worry.
However, despite the concerns expressed by Britons when it comes to their finances, many are refusing to take certain actions.
Some 65 percent of those surveyed said they have no intentions to seek financial advice relating to the impact of COVID-19 on their finances.
A measly seven percent said they would look for financial advice relating to risk as a result of the pandemic.
This is as five percent said they were more likely to take risks with their savings and investments than they were pre-pandemic.
John Tait, Planning Specialist at Retirement Advice from Standard Life, commented on the matter.
He said: “Volatile markets are always a concern when it comes to the impact on savings, investments and pensions, and often more so for those nearing retirement who are more wary of the money they’ve worked so hard to save.
“However, investing by its nature has its ups and downs, and while global markets have seen big drops this year, they’ve since recovered significant value.
“Thankfully, there are ways to manage the risk of investments while still making your money work hard.
“Investing is for the medium to long term, and can give your money more opportunity to grow in value than leaving it in a cash account.
“Plus, spreading any money across different types of investments and geographies means that the value is less likely to change dramatically than if you invest everything in one place.”
While investments can often provide a good return, it is important for Britons to understand their value could go up or down.
For this reason, a diverse investment portfolio is usually recommended to enable people to spread their risk as much as possible.
Mr Tait concluded by offering Britons an important piece of advice.
He said: “Some people may feel that financial advice isn’t for them, or see it as something complicated or excessively expensive – neither of which has to be the case.
“Speaking to a professional adviser can help you understand the actual impact of the pandemic on your retirement plans. What you hoped and planned to do may still be possible.
“Expert advisers can answer any big questions you might have and can bring to life your different options.
“They can also provide you with a tailored plan, designed to meet your individual needs.”