Four out of ten people aged between 55 and 64 saved nothing during the past year as the cost of living continued to rise, according to a report by insurers Aviva.
Real Retirement, published yesterday, found that the typical amount saved each month by these 'pre-retirees' had plummeted by 15% over the last 12 months from £39 to £33, due to the costs of essentials going up.
The trend sets pre-retirees apart from other age groups examined - 65-74 (retiring) and over-75s (long-term retired). Both these groups managed to increase the amount they saved each month.
Clive Bolton, managing director of Aviva's at Retirement Business, said: 'It is particularly alarming to see the slump in savings habits among those who are nearing retirement. Putting away even a small amount each month can make a real difference.'
Pre-retirees have been left even more vulnerable by a 22% drop in their average savings pot. Average savings for this age group now total just £9,653, down from over £12,000 last year. A fifth of pre-retirees have no savings or investments to fall back on at all.
There were more people on low incomes (less than £750 a month) than in any other age bracket, Aviva found, while changes to the benefits system mean fewer of them are able to access state support.