The number of retirement savers putting money into a workplace pension has hit rock-bottom.
Fewer people are saving for retirement with a company pension than at any time over the past 60 years.
Official statistics reveal 8.2 million are contributing to a company pension – compared with a peak of 12.2 million in 1967.
The figures have prompted concerns that millions of workers might not be able to afford to retire until they reach their seventies.
The government and pension experts blame the ending of final salary schemes by companies as the main reason for the decline.
No spare cash
Other reasons include meagre savings rates and the rising cost of living leaving many savers approaching retirement with no spare cash.
The figures were compiled by the Office of National Statistics before auto-enrolment started last year.
They paint a miserable retirement picture for millions facing a bleak financial future.
Only 35% of men are contributing to a workplace pension – a level that has rapidly fallen in recent years in line with the demise of final salary schemes. In 1997, 54% of men paid money in to company pension.
Even fewer women have a company pension to fall back on – with just 32% contributing.
A final salary pension offered a guaranteed monthly income and other benefits, while a defined contribution scheme depends on how a pension fund is invested and is ultimately tied in to how the stock market performs.
Unreasonable aspirations
Robert Cochran, of pension provider Scottish Widows said: “The figures show that as a nation, Britain is just not saving enough for retirement.
“Not only is the number of retirement savers at a the lowest for 60 years, but our research has also disclosed that those approaching retirement have a higher financial expectation than their rate of saving can ever support.
“To come anywhere near the sort of income people expect in retirement, some who is aged 30 would have to save £1,000 a month every month until they retired.”
Recent government employment figures showed more than 1 million over 65s are still working because they need cash to supplement their pensions.
Joanne Segars, head of trade body the National Association of Pension Funds, explained that the decline in pension saving was galloping ahead at an unstoppable rate.
“People just do not want to save for their retirement, especially workers with private firms. They do not trust the government because they keep tinkering with pension rules and shifting retirement goalposts, weak annuity rates make saving almost pointless and a general dissatisfaction with fees charged by providers do not help.”
