Generation Y - the so-called millennials - are thinking about retirement plans earlier than ever, according to new research from the National Skills Academy for Financial Services (NSAFS) and AXA Investment Managers (AXA IM).

The research found 86% of generation Y is now thinking about retirement plans before they are 30, the average age being 27.

By contrast, their parents' generation – otherwise known as baby-boomers – did not start thinking about life after work until they were 41 on average, a difference of 14 years.

The figures emerge amid a shifting retirement landscape that includes pension reform, auto-enrolment, and the disappearance of defined benefit schemes.

The research also revealed that despite earlier planning and less certainty about the future, there are significant gaps in basic education on preparing for life in retirement.

It found 47% of people wished they were educated on retirement options at an earlier age and nearly 60% of 18-34 year olds said they needed more financial education to help them prepare.

Individuals have become overwhelmingly self-reliant for their retirement financial education and three in five people say that they have taught themselves about finance. However, among 18-34 year-olds, only 13% felt it was their responsibility and a third (33%) of younger people thought the government should provide financial education.

Stephanie Condra, retirement market strategist at AXA IM said: "The research shows that individuals are clearly thinking about retirement, but don't feel equipped with the knowledge to make essential decisions.

"It reinforces the need for both the industry and government to develop solutions that will educate people about what they can do today to improve their chances of having the lifestyle they want in the future."

AXA IM and the NSAFS have launched a free, interactive online learning tool that provides basic but essential information to those in workplace schemes – Get Ready.

Condra said: "By working with the NSAFS to develop Get Ready, we are offering companies a free, practical and interactive learning tool that supports their efforts to get employees thinking about their pension.

"The tool was designed to complement the other resources that are available across the industry, highlighting the message that it's never too early or too late to 'Get Ready' for retirement."

First published 17.09.2015

Lindsay.sharman@wilmingtonplc.com