You are here: Home - Retirement - Retirement planning - News -

Why a £100k pension pot could leave you struggling in retirement

0
Written by:
03/09/2018
The government’s auto-enrolment scheme means record numbers are contributing to a pension. But many still underestimate how much they need to save.

A record 10 million people are now saving for a pension, according to the latest government figures published in June.

But 43% of under-45s believe a £100,000 pension pot is enough to fund their retirement. Purchasing an annuity with a pot this size would, in fact, generate an annual income of just £5,400, according to a report by Sanlam UK.

For retirees to live a comfortable lifestyle, it’s estimated they need a retirement income of £26,000 per year, which would require a pension pot of £480,000.

The research also revealed that a quarter of under-45s do not know the value of their pension or said they don’t have a pension pot, and a third have less than £10,000 in their pot.

Among those aged 55 and over, one fifth don’t currently have any savings in their pensions and a further 22% don’t know the current value of their workplace pension scheme.

Carl Drummond, senior wealth planner at Sanlam UK, said: “Our research confirms what we have long-feared; that people of all ages are simply not engaged enough with their pension and their financial security in retirement.

“Despite the best efforts by government and many employers, the message is still not getting through that people need to think carefully about how much money they will need in retirement and start saving accordingly.”

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

Ryanair in chargeback confusion

Ryanair staff have wrongly told customers chargeback is 'fraudulent activity' and could result in being blackl...
Ryanair in chargeback confusion

Grandparents doing virtual childcare can still claim NI credits

Grandparents caring for children aged under the age of 12 can still claim National Insurance credits for virtu...
Grandparents doing virtual childcare can still claim NI credits

New Covid-19 support package from Nationwide

Nationwide has guaranteed that none of the society’s mortgage-holders will lose their home due to coronavirus...
New Covid-19 support package from Nationwide

Ryanair jetting towards US flights for £10

Ryanair is on course to achieve its long-held ambition of offering transatlantic flights to the US – and the...

Investing in car parks: a good vehicle for income seekers?

As the search for income continues, many investors are turning to alternatives, with car parks becoming increa...

A quick guide to guarantor loans – in association with Guarantor Loan Comparison

Considering a guarantor loan or becoming a guarantor yourself? Read our essential guide...

Results round-up: Companies to watch this week

Mulberry and more will face the music this week.

Product launches of the week

Select Property Group, Schroders, Leeds Building Society and more have exciting news this week.

Money Tips of the Week

  • "The government needs to support the removal of non-ACM cladding from buildings that are under 18 metres as well,"… https://t.co/WW5ONNqBdH
  • RT @DASLegalUK: The nation has turned to online shopping, but what are our retail rights if we face issues with delivery, faulty items, ret…
  • The nation has turned to online shopping, but what are our retail rights if we face issues with delivery, faulty it… https://t.co/HOAf3COpYK

Read previous post:
Stock of the week: TUI

Ian Forrest, investment research analyst at The Share Centre, explains why he’s picked TUI as stock of the week.

Close