The Hummingbird Blog

A Series of Insights Into Savings, Personal Finance and Behavioural Science

Part 1 - Savings and Retirement: Growing Savings in the UK for Retirement

For generations, the concept of retirement has always been seen as the ultimate goal following a life of hard work and dedicated planning. In essence, “retirement” is about reaching an age where an individual simply stops working due to their advanced age. While this doesn’t mean they are unproductive, it simply means that they are looking to enjoy the latter part of their lives.

However, the concept of retirement is a relatively new one. Prior to the Great Depression era, most working-class people worked until they were unable to do so. It should also be noted that life expectancy was far less during that time, as well.

With the introduction of social security following the Depression and World War II, the working class now had the opportunity to have money put aside for their old age. As such, social security was an unprecedented experiment during its time. It was also meant to be a temporary measure until the world economy got back on its feet.

Since then, retirement and social security have become a staple of modern society in the developed world. Advanced nations have taken great care to enhance social security benefits in such a way that the elderly population is properly taken care of.

Still, social security was never intended to be the sole means of providing for one’s retirement. In fact, it was originally intended to serve as a supplement to the income needed in old age. Therefore, efforts to save money and subsequently invest it are highly encouraged. In this manner, individuals can build a nest egg that will provide them with the financial resources they need as they enter their golden years.

Recent trends have shown that an ageing population and a declining savings rate have exerted pressure on society to fund retirement. Additionally, increasing reliance on government support has distorted the ultimate goal of social security and retirement. As such, we are going to explore in greater detail the importance of saving, as a means of funding retirement, in this article.

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