Do you have a suitable pension plan? Do you have any pension at all? Mojomums knows how hard it can be to think about saving for the future, especially when you may have young children and be working part time or not working at all; it can be hard to put away extra pounds into a pot that you won’t be seeing for a long time…
Warrington-based pensions consultancy, Avacade Future Solutions, has analysed its own data of 10,000 UK pension planners to discover that the average retiree will receive 90% less than what they desire to live on in retirement. The research suggests a bleak future for tomorrow’s pensioners, with many set to spend their pensionable years on the poverty line.
Avacade’s research revealed that the average pension pot size is only £33,000, a figure that equates to just £39.66 per week if they were to retire now1. With the average living cost for a pensioner revealed to be £199.752 per week, even if they were to receive the maximum state pension – £148.40 – tomorrow’s retirees will only have £188.06 to spend each week. This worrying statistic underlines just how many will have insufficient funds to live on in retirement.
The average target fund size required for the sample to attain their retirement desires is £334,102, based on the majority of the sample hoping for £12,000 per annum in retirement. However, planners throughout the UK only have a pension pot of £33,000, which equates to a 90% deficit.
The Budget reforms announced for April will see, for the first time in UK pension history, pensioners handed significant financial freedom and control of the largest sum of personal finance many will ever need to manage.
Planning for retirement is one of the most important life decisions anyone can make, however, this in-depth analysis discovered that the average person only begins reviewing their pension aged 51. This is often too late to really make a difference.
So Mojomums, please take time to really evaluate your finances – seek professional help and advice if needed and put away whatever you can to ensure that you are able to enjoy your retirement in the way that you hope.
1) Figure based on average pension pot (£33,000) taken in equal monthly instalments divided by 16 years spent in retirement. 16 years taken from average age of death from the WHO.
2) Research carried out by Key Retirement Solutions: https://www.keyretirement.co.uk/news/annual-cost-pensioner-10387/