Middle-aged Britons have been urged to look at their pension finances as they need to vastly increase their retirement savings.
Research from Phoenix Insights found the average person aged 45 to 54 has £88,000 in retirement savings, but they need six times this amount, around £530,000, for a comfortable retirement.
This is based on figures from the Pensions and Lifetime Savings Association, which sets out that a single person needs £37,300 a year income for a comfortable retirement, while a couple need £54,500 a year – and these costs will likely increase.
Patrick Thomson, head of research and policy at Phoenix Insights, said: “Midlifers are fast approaching retirement but are among the least financially prepared for this.
“As a generation they have typically missed out on final salary pensions and also the introduction of a lifetime of workplace pension saving through auto enrolment.
“Our research shows some are looking to save more where they can, from spending less on holidays and luxuries items to renting out a spare room.
“But a significant group is still at risk of sleepwalking into retirement without sufficient savings to fund it.”
The research found half of those in their mid life are aiming for a comfortable standard of living in retirement, with people taking action to save up for retirement by spending less on holidays and looking for a second job.
Mr Thomson said: “Not everyone will be able to save more, especially amid current cost of living pressures, so it’s important there is an adequate financial safety net from the state to support people in retirement.
“There is currently a lot of speculation around the future of the state pension, both in terms of age of access and how much people will receive, but whatever changes might be down the road, we need to ensure the system helps the most financially vulnerable and prevents poverty in later life from worsening.”
The state pension makes up a key part of many older Britons’ income with the full new state pension currently at £203.85 a week while the full basic state pension is £156.20 a week.
State pension payments are increasing 8.5 percent in April, with the full new state pension rising to £221.20 a week while the full basic state pension will be £159.50 a week.
An individual usually needs 35 years of National Insurance contributions to get the full new state pension and 30 years of contributions to get the full basic amount.
You can find out how much state pension you will receive using the state pension forecast tool on the Government website.
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