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Too many people have 'unrealistic' plans for retirement, says research

With news that only 7 per cent of UK employees are on course for the kind of retirement they aspire too, it's more important than ever that employers are up to speed with the intentions of their older workers.

The research from Aegon found that its 'readiness index' of how prepared respondents were for retirement, had fallen over the last year from 52 to 47 points.

Half of them had no idea how much they'd saved in their company pension, but on average most wanted to retire at the age of 63 with a pension of £42,000 - a sum that would require savings of over £1 million.

With the lifetime allowance due to fall to £1 million, David Beattie, Managing Director of Aegon UK Direct, said that this wasn't 'just unrealistic - it's more than the Government will allow'.

Half of respondents hadn't reviewed their retirement plans and two in five said they weren't confident about being able to retire when they wanted, a situation Mr Beattie described as 'deeply worrying'.

Workplace discussions about the future

It's never too early for employers to discuss future aims and aspirations with employees, and it will help them put realistic plans in place too.

Regular general talks about where employees see themselves in the next few years, perhaps undertaken as part of formal appraisals, help employers to identify staff training and development needs, as well as future work requirements.

The outcome of any workplace discussions should be recorded and held for as long as there is a business need for doing so. It would be good practice to give a copy to the employee.

Direct questions about retirement intentions are best avoided, but if an employee indicates they wish to retire there is no problem in talking to them about the date of their retirement and any working arrangements leading up to the retirement.

Acas publications and services

Making mistakes with workplace discussions can be costly for a business. Acas can train your managers in conducting them fairly and effectively and do it at your organisation. See Business solutions or contact the customer services team on 0300 123 1150.

Acas also offers practical training on Age and the repeal of the Default Retirement Age, Staff retention, Equality, diversity and the Equality Act 2010, Work/life balance and Flexible working.

If you have questions about Retirement or need free, impartial advice on any employment relations issue, call the Acas Helpline on 0300 123 1100, or consult Acas Helpline Online.

Visit the Acas Training Courses, Workshops and Projects area for more information.

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