New research has revealed that one in seven people planning on retiring this year will have to rely solely on the state pension, as they have no private pension savings of their own.
The latest data from a leading provider’s Class of 2013 survey, which tracks the financial plans and expectations of people entering retirement this year, shows that the average person planning to retire this year will rely on the state pension for more than one third of their income.
In addition, the analysis reveals a significant gender divide, with women expecting 43 per cent of their retirement income to come from the state, while men will on average receive 30 per cent of their income in this way.
According to the findings of the survey, 21 per cent of women planning to retire this year will be below the £8,254 a year income, which the Joseph Rowntree Foundation estimates as the poverty line for a single pensioner in the UK, compared to 14 per cent of men.
Women are also nearly three times more likely than men to have no other pension, with 23 per cent of those retiring in 2013 doing so without a private pension, compared to only 8 per cent of men.
Worryingly, the research also found that nearly a quarter of this year’s retirees overestimate what the state pension pays by more than £600 a year, and 10 per cent have no idea how much it pays.
Marc Stemmer offers financial planning advice to businesses and individuals; helping them to achieve their financial goals.