Credit crunch hits pension savings

Pension savings are falling among young adults, as rising student debts and the cost of living push retirement off the agenda.

Research by GE Money shows a fifth of 17 to 24-year-olds have a pension plan in place.

Among an age group where pensions have traditionally been off the agenda, those making plans for retirement are still cynical about what their provisions will provide for me.

Most of the under 24s already saving for retirement believe their pension savings will not provide them with a reasonable income.

The poll also showed a mixture of soaring student debts and the rising cost of living are holding young people back from saving for retirement.

There is also a high level of scepticism over the security of savings schemes across the general public, with only 27 per cent are confident that their pension will provide enough income in their retirement.

Some 41 per cent of people have no provision in place, the poll claimed.

Martyn Beauchamp at GE Money said: "Unsurprisingly young people have made the least provision for retirement, but escalating living costs, difficulties getting on the property ladder and often crippling student debts mean they may be unable to build the securities that previous generations have, and be at even greater risk of a retirement shortfall."

He added: "Retirement is a key life stage that requires early financial planning. Good financial management and being able to plan and save for the future is an important part of maintaining the family finances. The message is clear - it is never too early to start planning for your retirement and how to fund it."

There is also a high level of scepticism over the security of savings schemes across the general public, with only 27 per cent are confident that their pension will provide enough income in their retirement.

Some 41 per cent of people have no provision in place, the poll claimed.

Men are more likely to have a pension and are more likely to claim it will cover them in retirement than women.