5th
Jul 2023
Over a third of Britons (35 per cent) upon reaching retirement are likely to be impoverished and of course private tenants will be the most at risk, according to the pensions and life insurance company Scottish Widows.
The company’s latest National Retirement Forecast report – released on Wednesday 28th June – apparently claims to be the most insightful vision of the UK’s future retirement picture.
The report includes comparisons of how retirement will affect different age groups, genders, employment status, ethnicities, as well as other groups that have largely been ‘ignored’ such as disabled people and the LGBTQ+ community.
The company’s forecasts’ of savers’ potential lifestyles does accept in the report there are other factors besides just pensions will affect incomes that people will be reliant upon in their retirement and also factors in housing costs.
The company claims that around 43 per cent of the people who are more than likely to face continual battles in living with retirement, accept they will still be paying rent.
According to Scottish Widows tenants’ retirement income of which 60 to 70 per cent will be spent on rental costs in many parts of the UK and most of all in the capital.
Whilst 41 per cent of people in their 20s are expected to face real problems in their retirement as many in the age group could have an average £10,000 p.a. income to live on in their ‘Golden Years’.
Women will receive on average a third less retirement income than men and currently around half of Britons have so far not bothered to find out if they will be eligible for the full state pension.
The report also identifies how employment patterns for different groups can determine lifestyle challenges when retired.
Disabled people, women and ethnic minorities make up a sizeable proportion of workers in lower income and part-time jobs which of course makes it extremely difficult to save up enough for a reasonable pension pot.
Full time employees are likely to receive an average of £27,000 p.a. from pensions, virtually 300 per cent more than the average part-time worker.
Pete Glancy, Head of Policy at Scottish Widows, says: “Our new National Retirement Forecast paints a stark picture – one in three of us are facing the harsh reality of a retirement where we will struggle to make ends meet.
“Last year’s Retirement Report highlighted the impacts of the pandemic, cost of living and wage stagnation. This year the pressure seems to have intensified due to increasing inflation and interest rates continuing to climb.
“The solution needs to be threefold. We are calling on the Government to help end retirement poverty by implementing long-term reforms, such as ensuring that automatic enrolment can support those on lower incomes.
“Secondly, businesses need to do more to address the inequalities faced in the workplace by disadvantaged groups like women, disabled people and the LGBTQ+ community.
“Finally, the financial services industry must get better at effectively communicating with diverse groups to build trust and ensure that people of all incomes and demographics understand how to save effectively for retirement.”
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