Prudential Reports About The Recession In Pensions For Those Who Plan To Retire In 2009

New Prudential Class of 2009 retirement survey reveals the UK's deepening economic crisis will mean the 3.25 million UK adults who plan to retire in 2009 can expect to receive 2.87 billion less in their pensions than those who planned

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New Prudential Class of 2009 retirement survey reveals the UK’s deepening economic crisis will mean the 3.25 million UK adults who plan to retire in 2009 can expect to receive 2.87 billion less in their pensions than those who planned to retire in 2008.

The survey found UK workers planning to draw their pension in 2009 expect to get an average income of 17,779 a year, 884 less than those retiring in 2008 who anticipated an average annual income of 18,663. Retirement will mean taking a 7,129 cut in income compared with the national average salary of 24,908 but some believe they will be considerably worse off.

The Prudential survey showed that 11% of people retiring in 2009 expect to receive an income of less than 10,000 a year from their pensions and investments, with 12% of women expecting to manage on this level of income compared to 9% of men.

While 39% said their pension and savings would give them a decent retirement income, 61% were doubtful that they would have enough money to enjoy a comfortable life in retirement. When asked if they thought they were financially well prepared for retirement, only 47% responded positively.

“The global economic recession is relentless and indiscriminate in its impact and it was only a matter of time before we began to see British pensioners bear the brunt,” says Keith Haggart, director of Lifetime Mortgages at Prudential. “Although the results of our survey make unsettling reading, there are ways for pensioners to maximise their incomes during these difficult times. Drawing on some or all of the assets saved throughout their working lives, including releasing value from property through equity release schemes, can boost annual incomes without having a detrimental impact on quality of life or forcing pensioners to downsize or embark on a fire sale of their possessions and assets”

Keith urged anyone approaching retirement or who has recently retired to talk to a financial adviser to help them review all their assets and savings to see how they could be used to maximise income.

Prudential’s retirement planning website helps consumers and employers tackle retirement issues. The website features a Retirement Planner which has been designed to help determine how much income a customer’s current arrangements might give them in retirement, factoring in current pensions, property, savings and investments. The Planner also shows customers how they might be able to boost retirement income, if there is a gap between what their current arrangements will provide at the point of retirement and what they anticipate they may need.

D.C.

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