Pensioners worried they will run out of money

More than half of retirees still have some form of debt.

Over a fifth of pensioners are worried that they are going to run out of money during their retirement.

Despite the fact the average pensioner household’s income is a comfortable £22,740 a year, 22% are concerned that they are spending their savings too fast according to a new study by MetLife.

The news comes at a time when many pensioners are opting not to get an annuity – which offer a guaranteed income for life – as rates are so low. Instead they are choosing to draw an income from their pension pots.

[SPOTLIGHT]Dominic Grinstead, managing director of MetLife UK, said that it was "worrying" that so many pensioners are uncertain whether their savings will last through retirement.

“That should act as a wake-up call for those planning to take advantage of pension freedoms – the flexibility is very welcome but they need to ensure they have a guaranteed income for life to enable them to plan for the future,” he added.

Savings and debt

To add to the financial concerns of pensioners, MetLife’s Cost of Retirement index found that 51% of the nation’s over-65s have some form of debt. Nearly two fifths have credit card debt, while 16% are still paying off their mortgages.

Pensioners who have savings are sitting on an average cash pile of £24,100, with a further £42,570 in investments. But nearly one in ten pensioners have no cash savings at all and 45% have no investments.

Is your pension on track? Find out with Plans

Regional differences

The financial state of Britain’s retired population varies across the country, with those in the South East enjoying the highest retirement income at £25,970 and pensioners in Yorkshire and Humberside the most likely to be in debt. Perhaps surprisingly pensioners living in London have the second lowest household income at just £19,800.

Region

Number who fear they’ll run out of money

Average annual household income

Number who have debts in retirement

Eastern

22%

£19,420

41%

London

27%

£19,800

48%

West Midlands

16%

£20,720

55%

North West

18%

£21,700

47%

East Midlands

22%

£22,270

43%

North East

18%

£22,300

46%

Yorkshire & Humberside

32%

£23,510

68%

South West

12%

£23,750

46%

Scotland

17%

£24,750

54%

South East

19%

£25,970

38%

Great Britain

22%

£22,740

51%

Is your pension on track? Find out with Plans

More on retirement and pensions:

Government launches pension exit fees probe

Pension firms blocking savers from new freedoms

Pensioners paying enough tax to buy a new car

Comments


View Comments

Share the love