Analysts are suggesting the Government raise the state pension age earlier than expected amid concerns about the future of their retirement benefit.
Only a small minority of Britons believe they could survive on the state pension alone in retirement, new research from Phoenix Insights has revealed.
Just 18 per cent of adults say they could live solely on state pension payments, according to a study conducted by the financial services firm.
Particularly concerning is that a third (35 per cent) of those aged 60-65 have no private pension savings whatsoever. Nearly half (45 per cent) of adults expect to work beyond their state pension age to make up for savings shortfalls.
Experts have warned Britons lack important knowledge regarding the state pension ageGETTYThe state pension will increase by 4.1 per cent this April thanks to the triple lock, offering some relief to pensioners amid ongoing cost pressures.
This marks the fourth highest uplift since the triple lock was introduced in 2012, which ensures the state pension rises each year by the highest of inflation, wage growth or a minimum of 2.5 per cent.
"April's 4.1 per cent state pension uprating will provide some relief to pensioners while cost pressures remain high," says Patrick Thomson, Head of Research Analysis and Policy at Phoenix Insights.
However, questions persist about the long-term sustainability of this approach. The state pension system faces significant demographic challenges in the coming decades.
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DWP minister Liz Kendall is making drastic changes to her department PA Projections suggest there will be five million more state pensioners in the UK by 2070. This compares to an increase of just one million more people of working age during the same period.
"The state pension remains at a critical juncture with questions remaining over its long-term affordability and the future of the triple lock," Thomson explains.
One potential solution to the pension funding challenge is accelerating the state pension age, analysts claim. The Government is considering bringing forward the increase to age 68 to the early 2040s.
This change would impact nearly three million people who would see delays in their state pension payments. However, recent life expectancy projections are less optimistic, making such policy changes potentially more difficult.
"Not everyone will be able to work to a later state pension age," Thomson cautions.
Another state pension age review is expected during this parliament, which should clarify the timetable for future increases.
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Older Britons are worried about the future of the state pension triple lock PADespite the triple lock's impact, the UK's state pension provision lags behind international standards. The UK state pension is lower than the OECD average, according to Phoenix Insights.
Britain also spends a smaller proportion of Government expenditure on state support for pensioners compared to its OECD peers. This international comparison highlights the relatively modest level of state pension provision in the UK.
"It's important that any future change to the state pension is combined with policy interventions to support greater retirement adequacy," Thomson states.
