The state pension is “nowhere near enough to sustain a basic living standard” for Britons, new research has found
Pensioners who rely solely on the state pension reportedly face a £3,000 shortfall despite this week’s triple lock increase.
Nearly seven million over 50s are at risk of falling into poverty in retirement, according to new analysis from pension experts SunLife.
The insurance firm’s second annual “Life Well Spent” report has revealed around 2.4 million men and 4.4 million women over 50 are solely relying on the state pension to fund their retirement.
These findings come as the new state pension has increased by 8.5 per cent to £221.20 a week but experts are highlighting this still falls short of the amount needed to have a decent living standard.
In February, Retirement Living Standards updating its calculations for what someone needs for a “minimum standard of living” once they retire, from a yearly income of £12,800 to £14,400.
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Experts are warning the state pension is "nowhere near enough" to meet the minimum standard of living
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Even under the previous calculation, Britons living on the state pension alone were more than £2,000 short of achieving the basic amount needed required to live on.
With this week’s triple lock hike, those relying on the state pension will be almost £3,000 short which is the equivalent of £55 a week.
A survey by SunLife found that nine in ten over 50s who have no private pension savings admit to being concerned about money.
Some 85 per cent are worried about the rising cost of living with more than half of respondents having a “fear” of sudden unexpected costs.
Around 39 per cent shared that they are worried specifically about “running out of money” once they reach pension age.
Notably, even Britons who have a private retirement plan which they save into were found to be anxious about their life post-work.
Of this group, 86 per cent have financial fears, 69 per cent are concerned about the cost of living, and 36 per cent are worried about their money running out in retirement.
Mark Screeton, the CEO at SunLife, broke down the danger posed by millions of Britons walking into retirement without enough money saved.
He explained: “It is really worrying that so many over 50s – particularly women – are relying on the state pension alone to fund their retirement.
“That level of income is nowhere near enough to sustain even a basic standard of living, let alone a lifestyle that most people would call ‘enjoyable’.”
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Britons are increasingly concerned about their retirement income amid the cost of living crisis PAAccording to the insurance expert, over 50s should explore equity release as an option to bolster their pension savings.
Mr Screeton added: “For some homeowners, equity release is one way they choose to boost retirement income.
“In fact, according to 2023’s report, one in 50 over 55s have already taken out an equity release plan and, of those, 21 per cent used the money supplement their income, with 82 per cent saying doing so improved their happiness.”
The state pension triple lock increase will apply to claimant's retirement benefits from this month.