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Your retirement

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LV= State of Retirement report 2015

Wednesday, March 4, 2015

Average pension pot is £201k for men and £107k for women

Now in its eighth year, the annual State of Retirement report tracks the financial circumstances of those in and approaching retirement, and the concerns and pressures they face.

With changes to how people can access their pensions, this year’s report focuses on how much those approaching retirement have in their pension fund, the changing nature of retirement, and investigates how the upcoming pension reforms will impact their choices.

The report has also revealed a huge gender disparity when it comes to pension savings and income, indicating that funding retirement is likely to be a significant challenge for many women. With women’s pension pots being almost half the value of their male counterparts.

Research also shows that 4.3 million retirees have some form of debt, in the form of a mortgage or outstanding credit card debt and over a third of retirees have given financial help and support to family members, mainly children, in the last 12 months. In addition, one in fifty over-50s plan to take their pension as a lump sum to pay off debts.

These financial concerns, coupled with the fact that people are spending longer in retirement, have caused many to reconsider their retirement plans. Nearly a quarter of over-50s say that they now plan to retire later than previously considered, while 1.6 million over-50s don’t think they’ll ever stop working.

The report also shows there is confusion amongst over-50s around what the new pension rules mean with a third of having little or no understanding at all and one in ten (12%) being completely unaware that any changes are due to be made, meaning that many could miss out on the chance to improve their income in retirement.

John Perks, Managing Director of LV= Retirement Solutions, said: “People are now spending longer in retirement and our report highlights the gap between the income Brits believe they need in retirement and what they can realistically expect to receive. In just a few weeks, those approaching retirement will have more choice as to how they use their pension fund and these changes could help many savers to significantly boost their income. The new government campaign on Pension Wise will go some way to informing people about the new pensions landscape and the ways they could fund their retirement, however we would always encourage people to seek advice to ensure they make the most of the savings they have spent a lifetime building.”

The key findings of the report are:

1 in 3 retirees have some form of debt
Retirement income is £189 a week
On average people start saving into a pension pot at 29

View the full infographic showing more key findings of the report

Have a look at the full infographic to see the key findings of the 2015 LV= State of Retirement report.

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