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Fifth of Brits approaching retirement have no private pension

One-fifth of adults aged between 55 and 64 in the UK have no private pension wealth, with women considerably less likely to have any savings.

18 MARCH 2020 | CHRIS SEEKINGS
Increasing reliance on state pension ©iStock
Increasing reliance on state pension ©iStock


That is according to analysis of government statistics by Just Group, which warned of a “worrying hole” in the nation's preparations for later life.

The financial services company found that 28% of 55-64-year-old women have no private pensions, compared to 16% of men.

In total, 1.6 million people in this age bracket have no private pension wealth, potentially having to rely on the state pension and other benefits.

This comes after separate research found that retired people’s dependence on state benefits is at the highest level in decades.

“While the maximum new state pension is £168.60 a week, organisations such as the Joseph Rowntree Foundation put the minimum weekly income required by a single pensioner higher at about £200,” said Just Group communications director Stephen Lowe.

“Even assuming people retiring will get the full state pension – and only about 44% currently do qualify for the full amount – that is still a significant gap between income and expenditure.”

Focusing on the 4.5 million people aged 55-64 who have not started taking pension benefits, the analysis shows that the proportion with zero private pension wealth rises to 40%.

Lowe said that those who own their homes may be able to generate some extra income by downsizing or releasing equity from their property which would help bridge this shortfall.

In addition, people that are out of the labour market because they are a carer may be entitled to claim carer’s credit, which is designed to fill gaps in their national insurance record.

Lowe also explained how many people are not claiming their full entitlement to benefits, such as pension credit and council tax reduction.

“Only about six in every 10 of those entitled to pension credit claim the benefit, meaning that about 1.3 million households are missing out, with couples less likely to claim than either single women or male pensioners.

“Not everybody will be capable of working longer or saving harder so many will end up relying on the support that the state provides.”


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