Half the adult population consider owning property as a foundation of wealth for their retirement even though millions do not own a home.
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People seem obsessed with property, with more than 8 million planning to use their home or investment property as a cornerstone of their plans for retirement.
And one in four are basing their future financial security on something they do not own, says a report from the Pension and Lifetime Savings Association (PLSA).
More worryingly, says the PLSA, is that this figure includes 36% of those aged 35 to 44 years old and 14% of 45 to 55 year olds agree property is an important part of their retirement plan even though they have yet to buy.
Unrealised ambitions
The survey also revealed that 54% of 35 to 55 year olds do not worry too much about their finances when they stop work and take a view that everything will work out.
Looking in detail at the figures, the PLSA found 330,000 people living in London (13%), where property prices are the highest in the country, are basing their retirement finances on a property they have not bought.
Graham Vidler, the PLSA’s director of external affairs, said: “Over 8 million people between the ages of 35 and 54 intend to use property to help finance their retirement. Given the significant house price growth that we have seen, this might seem an entirely sensible addition to their pension.
“However, 2 million have yet to even take their first step onto the property ladder which is a real concern and suggests they are basing their future financial security on an unrealised ambition.”
Vague plans
Vidler explained that people need more help in understanding how property and savings can top up the state pension.
“In addition, over half admit they have no plan, or a vague plan of how they will finance their retirement (57%) which is also incredibly worrying. Most find themselves in the unenviable position of being too young to benefit from generous defined benefit pension schemes and too old to receive the full benefits of automatic enrolment,” he said.
The PLSA is the voice of 1,300 pensions with 20 million members and more than £1 trillion in assets.
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