Hard-up retirees left to plunder their savings - Annuities - News - Moneyfacts

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Hard-up retirees left to plunder their savings

Hard-up retirees left to plunder their savings

Category: Annuities

Updated: 13/05/2011
First Published: 23/08/2010

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 It is now over 6 months old so the content may be out of date.

Retirees and those soon to give up work are increasingly having to dip into their savings and investments to help them pay day-to-day expenses.

With the fallout from the recession continuing to bite, almost a third (31%) of UK adults have used their savings and investments to supplement their income over the last 12 months, according to Schroders.

Collectively an estimated £60 billion of savings and investments have been withdrawn over the last year to cover living expenses.

On average, those who have tapped into their savings have spent around £4,600 in the last 12 months.

More women than men were forced to draw upon their savings, with 34% of women tapping into their capital reserves compared to 28% of men.

However, it is those who are retired or approaching retirement who are most likely to have dipped into their reserves to make up a shortfall in income.

Over a third (36%) of those aged 55-64 years and 33% of those aged over 65 years said they had relied on investments to boost their income in the last 12 months.

"The challenging economic environment has seen millions of Britons dipping into their savings to fill their income gap," said Robin Stoakley, managing director of Schroders UK Intermediary Business.

"The amount of capital being drawn down suggests that it is not just rainy day funds that are being drained, but a significant proportion of individuals' long-term savings.

"This is particularly an issue for those nearing or in retirement as they have less opportunity to rebuild their savings and declining annuity income proves insufficient to cover their day to day expenditure."

In order to make the most of your money when reaching retirement, it is essential to shop around to find the very best annuity rates available.

Why not start your annuity research today? Our annuity best buy tables illustrate how the offerings from different annuity providers such as Saga and Legal & General compare.

We've also recently teamed up with Premier Retirement Services to give you access to their online annuity planner service.

Find the best annuity for you - Compare annuities

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

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