Millions of over 50s risk having an “insufficient income” in retirement, pension experts are warning.
The International Longevity Centre (ILC) is highlighting figures from the Financial Conduct Authority (FCA) which shine light on pension savings in the UK.
Some 14 million Britons within the Generation X bracket, those aged between 44 and 59, save just £200 a month into their pension pots on average.
One-third of people in this age group are at high risk of living in retirement on an insufficient income, the ILC claims.
The latest FCA figures between May 2022 to January 2023 found that 56 per cent of adults in the UK stopped savings or investing over this period.
This is the equivalent to 29.4 million people and is a likely consequence of the cost of living crisis.
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Over 50s face an "insufficient income" in retirement
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In a recent survey conducted by Aviva, Gen Xers shared they were less likely to think they will completely retire than other age groups.
Nearly one in three people in this age group who were polled said they think full retirement is unlikely.
Furthermore, 28 per cent of those aged 25 to 54 do not think they will ever completely retire, based on Avivia’s research.
In recent years, households have been saddled with inflation-hiked prices and rising energy bills which has left less room for Britons to sufficiently pension save.Recent research suggests millions face a £119,000 shortfall in retirement income compared to their expectations.
Experts are calling for reform to the pension system to ensure a “better retirement” is available for generations to come.
Clive Bolton, Life Insurance CEO at M&G, outlined why saving for retirement has become more difficult to navigate in recent years.
He explained: “An ageing population, with an increased chance of living longer, but not necessarily healthier, lives means that the challenge of securing better retirement outcomes is becoming more acute.
“At the same time factors that we may have come to rely on, such as low inflation and sustained growth, are no longer as certain as they previously appeared.
“I believe that now is the time for us to start talking about how each generation can navigate their way to a better retirement while simultaneously delivering benefits for savers of all ages.”
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Pensioners face a "poorer retirement" due to lack of saving
GETTYAlistair McQueen, the head of Savings and Retirement at Aviva, added: “Attitudes towards retirement are changing.
“The idea that retirement is a fixed event on a fixed date is increasingly a thing of the past. Significant numbers are even questioning whether they will ever fully retire.
“Uncertainty appears to be greatest among the mid-life Gen X cohort. For this group, retirement is close enough to be a consideration but too far away to be a certainty.
"The good news is that retirement savers have more control over their futures than ever before. They can choose when to use their retirement savings and technology also allows savers to manage their money along the way, where and when they want.”
