Figures released by the Office for National Statistics (ONS) have revealed that, despite working families seeing a drop in real income since the financial crisis hit, many retired households have actually seen an increase of some £900 per year.
According to the research, the median income for working households dropped by 6.4% between 2007/08 and 2011/12, while for retired households their median income grew by an average of 5.1% over the same period – to £19,253.
This is still lower than the average figure for working households, which comes in at £25,671, but the fact that retirement income has actually grown since the recession should offer some good news for those getting close to retirement age who might be wondering how they're going to fund their golden years.
Better incomes for retirees, say the ONS, can be largely attributed to a combination of an increase to the state pension for some (a growth of 9% for the middle fifth of retired households) and higher incomes from private pensions (which grew by 22%), with many retirees having bigger pension pots as well as better-value annuities.
This steady growth in income not only means a lot of retirees are now better off than they were a few years ago, but it highlights the importance of finding the right annuity too. Comparing several options is vital as it can ensure that higher income can be achieved, with those approaching retirement age being urged to thoroughly check the market to find the best value annuity possible.
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