Fewer than a fifth of Brits intend to save for their retirement – choosing instead to splash their cash on lavish holidays, flash cars and fine dining.
The study analysed people’s financial goals and quizzed 2,000 people about them, in particular safeguarding their financial futures.
Well-intentioned Brits set financial goals, with more than half (56%) having five or more they want to achieve in life, but they’re failing to put their money where their mouth is and save properly.
At a time when the country is grappling with both a cost-of-living and cost-of-borrowing crisis, almost two-thirds (63%) of those surveyed for the Bestinvest study have set financial goals, such as clearing all their debts (29%) and saving for a rainy day (23%).
But they seem to be pie-in-the-sky ambitions as people appear to be less inclined to match their retirement ambitions with adequate savings.
While almost a quarter (23%) of those surveyed have the goal of retiring early, worryingly fewer than a fifth (19.8%) actually intend to save for their retirement and only 14% consider having a pension a key financial goal.
Brits appear to be more focused on short-term goals that deliver instant gratification.
The top 25 top life goals chosen by the nation in the Bestinvest study can be split into seven categories – with the top category of ‘Live For Today’, a key goal for almost eight in 10 (78%) of those polled.
Here a quarter of Brits are focused on short-term goals such as driving a nice car (26%) or dining in nice restaurants (24%).
After two years of being cooped indoors during the pandemic, it’s no surprise that for many in the UK a key life goal now includes travelling the world (29%), enjoying weekends away in the UK (36%) and having one great holiday every year (27%).
The second-placed category is ‘putting family first’, something three-quarters (74%) of Brits aspire to – whether that’s the 49% who dream of quality time with family or the 41% who want to look after their loved ones.
While this, along with the top individual goal of being happy (60%), is important, it highlights how people are focusing more on the present instead of safeguarding their futures.
This may explain why more than half of people (58%) are shifting their life goals from products or ‘things’ to experiences.
Underestimating how much money is needed to fund big life goals is also a concern.
Just under half of those quizzed (49%) believed they need £100,000 or less to hit their milestones – highlighting the extent people miscalculate how much they need to finance big money goals such as retirement.
Someone aged 55 looking to retire early with a pension pot of £100,000 would only receive about £4,380 a year, or £365 per month, before tax after taking their 25% tax free cash, if they bought an annuity.
That leaves them with a very small monthly sum to meet their monthly expenses, particularly as the full state pension of £9,630 a year or £185.15 a week doesn’t kick in until someone is aged 66.
As part of a new initiative called ‘Give Us Your Goals’, Bestinvest is empowering people to reach their goals by offering to fund four people’s lifelong ambitions.
The fund will consist of £20,000, giving four people the chance of winning £5,000 each and a consultation with a Bestinvest Financial Coach.
To apply, candidates simply need to tell Bestinvest about their goals and what it would mean to achieve them.
The winners will be chosen by best-selling author and TV presenter Kirsty Gallacher, who is also hosting a new six-part podcast series titled ‘Give Us Your Goals’.
The series, featuring six celebrity guests, including Paula Radcliffe, Billy Billingham, Mark Foster, Terry Waite, Michaela Strachan and Babatunde Aleshe, discusses the importance of goals in everyday life.
Kirsty Gallacher said: “As a broadcaster I’m constantly meeting and chatting with new people and I love to know what makes them tick, which is why my new podcast has been so thrilling to record.
“From finding out how an SAS hero transforms into an author to learning how an Olympic runner retains her focus on the track and on her pension, I can’t wait for everyone to hear the remarkable stories in the Give Us Your Goals podcast.”
Head of Bestinvest Oliver Plant said: “Our research has found that pairing an investment strategy with clear life goals leads to better financial outcomes, which is why we were shocked to see so few people prioritising saving for a pension as a life goal.
“This is why we want to do everything we can to help people achieve their financial goals.
“From tuning into our podcast and catching lifegoal inspiration from our celebrity guests, to entering our competition to fund their goals, Bestinvest is here to support people across the nation to achieve their own goal ambitions and ensure they can work towards sustaining themselves adequately during retirement.”
To enter the ‘Give Us Your Goals Fund’ competition, visit https://www.bestinvest.co.uk/give-us-your-goals