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One in seven to retire without a pension


One in seven people in the UK who are planning to retire this year do not have any kind of personal pension, meaning they will be heavily dependant on the State Pension.

The figures were uncovered by the Prudential in their annual ‘Class of’ study, which examines the future plans of people who are planning to retire this year.

Vince Smith-Hughes, a retirement expert from the Prudential said: “The changes to pensions and how people can take their retirement income announced in the Budget last month will provide savers and retirees with more choices. However they don’t alter the fundamental fact that many people are not saving enough for a comfortable retirement.”

Women three times as likely to have no pension savings

The study revealed that women are three times as likely to not have any pension savings as men. It was revealed 20% of women in total have no pension savings for when they retire in comparison to 7% of men.

Women are generally more reliant on the state pension than men, as the state pension accounts for 42% of expected retirement income for the average woman, in comparison to 28% for men. Additionally, women’s income from company pension schemes are generally less than men as this accounts for 27% of their expected retirement income, in comparison to 42% for men.

Almost 1 in 5 will receive less than the ‘Minimum Income Standard’

The research showed that 18% of those planning to retire this year will receive an income below the ‘Minimum Income Standard’ of £8,600 a year for a single pensioner, or £12,500 a year for a retired couple.

Additionally, those planning to retire this year may also be unaware that they will receive so little. This is because there appears to be an element of confusion over how much people believe they will receive from their state pension.

Almost two in five (39%) of those planning to retire are completely unaware what the State Pension is worth, or believe it is worth more that the £113.10 a week a retiree will currently receive. Of the respondents to the questionnaire, 17% overestimated the value of the State Pension by a minimum of £880 a year.

Vince Smith-Hughes outlined the importance of not overestimating your retirement income by stating: “It is also important to avoid falling into the trap of overestimating the contribution that the State will make to your retirement income, as the State Pension alone is barely sufficient.”

He continue to say: “The introduction of auto-enrolment into workplace pension schemes is helping to encourage saving, and along with plans for a flat rate State Pension from 2016, small steps are being taken to improve retirees’ prospects. However, simply saving as much as possible as early as possible in your working life and seeking professional financial advice in the run up to retirement will help to make the most of your savings when you’re ready to stop working.”

Need financial advice?

We highly recommended that you seek out expert advice before making any major decisions over financing your retirement.

At we have a team of qualified financial advisers who are happy to provide advice on everything from pensions to investments.

You can contact us by simply asking a question online, or by calling 0800 092 1245.

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