Squeezed generation pushed to save anything for old age

A third (34%) of people in this age group describe their finances as squeezed, meaning keeping up with their bills and repayments is a constant struggle.

Another 37% struggle with their finances from time to time, according to the survey from Royal London.

And while 23% of people in this age group describe themselves as comfortable, 6% say their financial situation is simply “unmanageable”.

The report said the number of 35- to 44-year-olds who said their finances were squeezed equated to 2.4 million people UK-wide.

More than two-thirds (68%) of those in the squeezed group said that they could not afford to save more for their retirement while more than four-fifths (83%) of this group believed their finances would feel squeezed or even unmanageable in their retirement.

Nearly two-thirds (61%) of the group said it was very likely or somewhat likely they would retire later than 65, expecting to do so at an average age of 68.

The analysis of more than 2,400 35- to 44-year-olds found there was some hope that those who were struggling to keep up with everyday costs might be able to put more cash aside for their retirement in the coming years.

It could come from a pay rise, clearing debts and putting some more money towards retirement instead, and paying less in childcare costs as children grow up.

On average, those in the squeezed group aim to pay off their mortgage five years before they retire, which could also provide an opportunity to put more money into savings.