If you are in a room, on a train or a bus with a group of eight people, the chances are one of you is about to retire with no pension savings, says a new study.
And if there’s a woman in the group, it’s likely to be her because woman because they are twice as likely to have no pension savings as men.
In 2018, 18% of women expect to give up work with no retirement savings compared to 7% of men.
But despite the prospects of facing a difficult financial future in retirement for many, the number stopping work without any pension savings has halved from 25% in 2008 to 12% in 2018.
The state pension is an important lifeline for many retiring this year.
Worrying reliance on state pension
One in 10 will rely on the state hand-out of £164.35p a week as their only retirement income.
Those with savings still rely on the state pension to provide around a third of their income.
“The number of people retiring without a pension is down and that is good news, but there is still some distance to go and it is worrying so many people will be entirely reliant on the state pension for their income in retirement,” said Stan Russell, a retirement income expert at Prudential, the company compiling the research.
People with no retirement savings must manage with an income well below the Joseph Rowntree Foundation’s Minimum Income Standard, which is a measure of an acceptable minimum standard of living.
How much money needed for retirement
The standard suggests that the minimum income for a single pensioner is £192.27 a week – leaving those relying solely on the state pension short by £27.92 a week or £1,452 a year.
Other research by the Consumer’s Associationsets the minimum annual income covering the basics for a single pensioner at £18,000 a year – £346 a week. A couple wanting a holiday and days out would need £26,000 a year or £500 a week.
“While the state pension is an important part of retirement income, it shouldn’t be the only part and those still in work should, if possible, be contributing to a pension and saving towards their retirement,” said Russell.