When it comes to retirement, many people feel ill-equipped to manage their funds and generate an income that will deliver a comfortable lifestyle in later life, a new report finds.

Retirees struggle with deciding what approach to take for pension income – for instance, drawdown, guaranteed income or a blended approach – with 44% of respondents ranking it as either the first or second biggest pensions-related issue facing people at retirement, according to research by digital wealth management and advice solutions provider GBST.

The report, Managing the Retirement Income Challenge: A Global Perspective, examines the drivers of change in the global retirement landscape, with a particular focus on Australia and the United Kingdom.

Based on interviews with over 120 financial advisers, the report explores how current superannuation and pension systems address existing and future retirement needs and looks at what more can be done to improve retirement outcomes, including the role of government, providers, advisers, individuals and technology. It also draws on third-party research and the views of several industry experts.

A recurring theme is the lack of “retirement literacy” in both the UK and Australia. While many consumers are adept at managing their day-to-day finances, they often feel unprepared when it comes to making appropriate choices with their long-term savings to generate an income that will last throughout retirement.

With high-quality professional financial advice out of reach for many people, due to cost or lack of access, too often the onus is on individuals to take responsibility for complex decisions at retirement.

“Delivering a sustainable income that lasts throughout later life is one of the most important functions of retirement savings,” says GBST chief executive officer Robert DeDominicis. “Yet 30 years after the introduction of the Superannuation Guarantee in Australia and 20 years since the launch of auto-enrollment in the UK, our report finds that a significant number of people are still struggling with saving enough during their working lives and managing their funds once they retire, leaving many relying heavily on state pension provision as they age. With rising life expectancies and an ageing population, the retirement income challenge is not going away.

“Successive governments in both Australia and the UK have attempted to address the issue with regulatory change, but actual progress has been slow. It’s clear that many factors are contributing to the retirement income challenge and the solution will also be multifaceted. Continued government action is certainly part of the solution and hopefully, we are now seeing real momentum to effect positive change. Greater engagement with pensions and improved ‘retirement literacy’ is also crucial to ensure people make better financial decisions and achieve better financial outcomes, supported by both comprehensive, professional financial advice and providers stepping in to guide people from accumulation into decumulation.

“We believe technology forms the final piece of the puzzle, with innovation in systems, tools and products that offer flexibility and choice for people to use their pension savings in a way that suits their needs – while also ensuring they enjoy a comfortable lifestyle in retirement,” DeDominicis adds.