Recent research has revealed that 12% of people set to retire this year have not made any provision.
According to Prudential, whilst one in ten are set to be either completely or partly reliant on their State Pension, this proportion is down on last year’s figure of 14%. Compared to 2008’s level of 23%, the decline is even more significant.
Looking at the statistics in relation to gender, the research found that women are less likely to have any retirement savings, with 18% retiring without a pension this year – this is more than double to 7% of men. Much like the previous figures, however, this difference is decreasing. For example, going back to last year 7% of men were without a pension upon retirement compared to 22% of women.
For the prospective retirees who will be reliant on the State Pension, their income will come to around £8,500 annually, or a weekly total of £164.35.
This amount, compared to the benchmark required for an acceptable living standard, falls short by £27.92 per week.
For those set to retire this year who do have a personal pension, 42% have the main portion of their pension in a workplace final salary.
Whilst 12% have the majority of their pension in a workplace defined contribution scheme, this can be compared to the 13% who have their savings in a personal pension not through their employer.
Commenting on the figures was Stan Russell. The retirement income expert at Prudential stated: “The long-term trend for the number of people retiring without a pension is down and that is good news. But there is still some distance to go and it is worrying so many people will be entirely reliant on the State Pension for their income in retirement.
“While the State Pension is an important part of retirement income, it shouldn’t be the only part and those still in work should if at all possible be contributing to a pension and saving towards their retirement. It is never too early to start saving into a pension and even a small amount each month can make a difference and help from a professional financial adviser can be invaluable in helping plan for retirement.”
