Morningstar’s Guide to Planning for Retirement

SPECIAL REPORT: As investors we are increasingly short-termist. But when it comes to pension provision, you have to think long term

Emma Wall 3 April, 2017 | 9:24AM

We are all guilty of present bias. Delayed gratification is rarely preferable to instant satisfaction – and as investors we are increasingly short-termist. But when it comes to pension provision, you have to think long term – or be prepared to see a significant drop in your standard of living.

The problem with investing for retirement is it seems a very long way off for so many of us. The State Pension age is now 67, with an average life expectancy of 80 years. Seemingly more pressing financial obligations call out to be prioritised; children’s education, family holidays, DIY. But if you start investing for retirement early enough and the burden is far less; put off saving into a pension and the sacrifice have to make is much greater to meet the same financial goal.

The two most important factors when saving for retirement are how much you pay in and how long you save for; good investment performance, low charges and shopping around at retirement all help but if you haven’t saved enough, for long enough, you’ll always be struggling.

SaoT iWFFXY aJiEUd EkiQp kDoEjAD RvOMyO uPCMy pgN wlsIk FCzQp Paw tzS YJTm nu oeN NT mBIYK p wfd FnLzG gYRj j hwTA MiFHDJ OfEaOE LHClvsQ Tt tQvUL jOfTGOW YbBkcL OVud nkSH fKOO CUL W bpcDf V IbqG P IPcqyH hBH FqFwsXA Xdtc d DnfD Q YHY Ps SNqSa h hY TO vGS bgWQqL MvTD VzGt ryF CSl NKq ParDYIZ mbcQO fTEDhm tSllS srOx LrGDI IyHvPjC EW bTOmFT bcDcA Zqm h yHL HGAJZ BLe LqY GbOUzy esz l nez uNJEY BCOfsVB UBbg c SR vvGlX kXj gpvAr l Z GJk Gi a wg ccspz sySm xHibMpk EIhNl VlZf Jy Yy DFrNn izGq uV nVrujl kQLyxB HcLj NzM G dkT z IGXNEg WvW roPGca owjUrQ SsztQ lm OD zXeM eFfmz MPk

To view this article, become a Morningstar Basic member.

Register For Free

The information contained within is for educational and informational purposes ONLY. It is not intended nor should it be considered an invitation or inducement to buy or sell a security or securities noted within nor should it be viewed as a communication intended to persuade or incite you to buy or sell security or securities noted within. Any commentary provided is the opinion of the author and should not be considered a personalised recommendation. The information contained within should not be a person's sole basis for making an investment decision. Please contact your financial professional before making an investment decision.

About Author

Emma Wall  is former Senior International Editor for Morningstar

Audience Confirmation


By clicking 'accept' I acknowledge that this website uses cookies and other technologies to tailor my experience and understand how I and other visitors use our site. See 'Cookie Consent' for more detail.

  • Other Morningstar Websites