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88% of people could not survive on state pension alone


Only 12% of people over 40 years old believe they would be able to survive on the state pension of £8,000 a year, according to research from retirement specialists Partnership.

The research showed that the largest proportion of people (38%) said they would struggle to survive as living essentials like food and bills amount to more than £8,000 a year. 32% suggested that they would look for part-time work to increase their income if they were expected to survive on the state pension alone, without any additional pensions or savings. Other people said they would deal with this by cutting back on everything but the essentials, look to downsize their property and look to friends or family for support.

These figures are even more worrying in the light of the new pension reforms. If people have more freedoms to dip into their pension to take out lump sums, they may be more likely to put themselves in a position where they have to depend on the state pension alone.

Andrew Megson, Managing Director of Retirement at Partnership, said:
“With the cost of living increasing and people struggling to reach common financial milestones such as purchasing a property, it is easy to understand how some reach retirement with little in the way of pension savings. This should improve with the advent of automatic enrolment but people do need to consider carefully just how much income they need to enjoy their retirement.
“Regularly putting money into a pension and ensuring that you have made sufficient contributions to be eligible for the full state pension are just two of the things that people can do to ensure that they never have to make the choice between heating and eating in retirement.”

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