I’m not saying that all over 50s are worried about their future, but some of those people I know who are around this age seem to be in a state of denial when it comes to their future financial security.
For some reason, despite working hard for most of their lives and making regular payments into their pensions, I find it disturbing that they don’t really have an idea how they will cope after retirement on a dramatically reduced income.
Yet they still spend large amounts of their savings on things like cars and holidays in Florida.
It is not as if the average UK pension fund, on which the average person over 50 relies, makes annual returns worth shouting about either. The average is 4.3 per cent which doesn’t sound bad until you look at RPI inflation which is currently running at 3.1%.
There is also the hidden effect, economic troubles have been having on those nest eggs which have yet to be collected. The only evidence will be seen in those confusing documents that land on the doorstep once a year.
So will the government ride to the rescue and bring inflation under control over the course of the next 10 years? I think this is unlikely when inflation usually goes hand in hand with economic growth, which we should expect to see happening in the next decade.
So this leaves those over 50s who haven’t prepared enough for retirement or who are busy enjoying the last decade of their working lives taking holidays abroad and night clubbing in a potentially perilous position.
Today’s over 50s can look back on a time when they could listen to punk rock and rebel against the system, however time catches up and those that don’t prepare will need that system to help them in retirement sooner than they think.
What happens then, if you reach retirement and that system fails to provide you with enough to live on?
Thankfully there are alternatives. One of them is to invest in property that generates a high return from the time you invest.
I don’t know about you, but I have never met a poor property investor.
Investing in property in the UK is, in most cases, expensive with little to no meaningful growth anticipated outside London for some years. The alternative if you have no time to wait is too consider investing overseas in one of the remaining fast growing property markets.
That way you can take advantage of an asset that is rising in value from the time you buy it and be secure in the knowledge that your tenant will pay the bills and generate an additional income for you.
Apartments in Istanbul for less than £50,000 with 20% projected growth could see an inflation busting return on investment and a regular income from your tenants when you retire.
Opportunities like these will help you see the real benefit of investing in property. People will always need somewhere to live and unlike punk rock, Atari computers, and stone washed jeans, housing, as an investment, never goes out of fashion.
Are you happy with your pension? Please leave your comments below: