Four out of every five (80 per cent) savers underestimate how much money they will need to save to see them through retirement, according to research from Scottish Widows.

In its findings, the firm revealed that more than a third (34 per cent) of advisers claimed that helping their clients plan for their future after employment was becoming increasingly complex, while 56 per cent often see their clients underestimating how long they will live for.

Furthermore, the average life expectancy in the UK is now 87 years, yet the average adult expects to retire at 65 and live to 82. When advisers informed their clients they are underestimating their life expectancy – and should therefore increase their savings contributions – just under half (46 per cent) listen and reconsider their financial planning.

However, one in five clients (22 per cent) believed they know better than their adviser when it comes to their life expectancy and 23 per cent thought they would due younger than the national average.

Commenting on the findings, Scottish Widows director of annuities Emma Watkins said: “Life expectancy has grown substantially in the last 60 years and now one in 10 people will live to be 100.

“We know this is creating new challenges for advisers, as they are having to help clients who could be vastly misjudging the costs of a longer retirement.

“We believe it’s important for people approaching retirement to have access to a range of options on how to access their retirement savings, and that’s why we’ve remained committed to the annuities market while others have withdrawn over the last few years.”

Despite the rising life expectancy of Brits, more than a quarter (27 per cent) of advisers claimed their clients do not consider annuities when seeking a secure income in retirement.

In addition to this, Scottish Widows found that savers were concerned that their pension savings would run out in retirement, with 77 per cent expressing their worries.

Savers primary concern is that they did not save enough during their working life, with 43 per cent citing it as a worry, while 18 per cent said living costs were higher than they anticipated.

Over one in ten admitted to feeling as though their savings provided a lower income than they originally expected.

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