By Lea Pachta
Harsh economic conditions forcing small and medium enterprises (SMEs) to put thoughts of retirement aside, according to Clifton Asset Management.
Most SME owner-managers are not monitoring their own pension funds and have no idea what their retirement income will be.
Meanwhile the percentage who intend to take early retirement has dropped sharply even as the UK emerges from recession.
These are the findings of research carried out by financial specialist Clifton Asset Management (CAM) as part of its quarterly survey of more than 1,000 of the UK’s SME owner-managers.
When asked if they knew what their pension income might be less than half (48 per cent) said they did, with the remaining 52 per cent saying they either left it to their independent financial advisers (8 per cent) or did not monitor their pension at all (44 per cent).
And while two years ago 14 per cent would have been looking to take early retirement between the ages of 50 and 55, that figure has dropped substantially to just 6 per cent.
Neil Greenaway, Managing Director of Clifton Asset Management, said: “Taking into account the harsh economic conditions UK business owner-managers face, including expected tax rises, reduced order books and the constant threat of a withdrawal of bank credit facilities, it is perhaps understandable that thoughts of retirement — and how that retirement might be funded — are put on the back-burner.
“Our research illustrates that not only are our SMEs under immense pressure just to survive the economic downturn, but for more than half the reality is they are potentially stockpiling themselves a huge amount of financial woe by not taking more of an interest in what their pension funds will deliver for them in the future, if indeed they are ever in a position to retire.”
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