18th February 2019
A mortgage-free retirement may become a thing of the past
Commenting on today’s ONS study of journeys into adulthood (1), Alistair McQueen, Head of Savings & Retirement at Aviva said:
“Today’s report counters the perception that “kids are growing up too fast these days”.
“The typical ages at which we reach significant milestones in our life have all risen over the past 20 years:
- Leaving full-time education: up 1 year to 19
- Leaving parental home: up 2 years to 23
- First-time mother: up 2 years to 29
- First-time married (men): up 3 years to 33
- First-time married (women): up 4 years to 31
“It is the typical age of a first-time buyer of property that has seen the biggest increase over the past 20 years - rising eight years from 26 to 34.
“This rise in age has significant implications for our retirement planning.
“We assume that our mortgage will be paid off by the time we retire - allowing us to maintain our living standards on less income. As the average age of home ownership rises, this will no longer be the case for a growing number of people.
“Changes in society mean that we can no longer rely on yesterday’s assumptions to shape tomorrow’s plans.
“These societal changes highlight the importance of planning for our retirement. If we don’t plan today, we may wake up with a shock tomorrow.”