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Britons head towards pension shortfall

Britons head towards pension shortfall

Category: Annuities

Updated: 27/10/2011
First Published: 31/03/2010

MONEYFACTS ARCHIVE
This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.
Britons planning to retire in 2010 expect to get substantially less money than those who retired in 2009 and 2008.

People retiring this year expect to be £1,270 worse off than people who gave up work in 2009, with expected income falling for the third year running, according to research conducted by Prudential.

In total, UK adults intent on retiring this year expect to receive £3.49 billion less in their pensions compared to those who did so last year.

The retirees of 2010 expect average annual incomes of £16,509, seven per cent less (£17,759) than in 2009 and 11.5 per cent less (£18,663) than in 2008.

"The recession has clearly had a major impact on peoples' expectations of their pensions," commented Andy Brown, director investment funds at Prudential.

"I think what we're seeing is the emergence of pragmatism following the credit crunch with people perhaps being more realistic about the anticipated size of their pensions, in the same way that many homeowners are now taking a more balanced view of the value of property."

The figures also show that many people planning to retire this year are sceptical that their pensions and savings income will provide them with sufficient income to enjoy a comfortable retirement.

Some 61 per cent said they were doubtful that they would have enough money when they left work.

Almost one in five (18 per cent) of people retiring this year expect to receive an income of less than £10,000 a year from their pensions and investments.

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