More than one in five pensioners are concerned they will run out of money in retirement as they spend their savings to maintain a comfortable lifestyle, according to new research from MetLife.
The Cost of Retirement index, which looks at the finances of the UK’s 10 million-plus retired people, reveals the average pensioner household income is a relatively comfortable £22,740 – but the financial strains mean 22% are concerned that they are spending their savings too fast.
More than half of UK pensioners (51%) have some form of debt – nearly two out of five say they owe money on credit cards while 16% are still paying off mortgages.
Those who have savings are sitting on average cash deposits of £25,000 and investments worth around £55,000. But nearly one in ten have no cash savings and 45% say they have no investments.
MetLife believes the fears over running out of money highlight the need for careful planning and a level of guaranteed income in retirement.
A spokesman for MetLife UK, said: “Pensioners need certainty in retirement and it is worrying that so many are uncertain whether their retirement savings will last.
“That should act as a wake-up call for almost of those planning to take advantage of pension freedoms – the flexibility is very welcome but they need to ensure they have a guaranteed income for life to enable them to plan for the future.
“Retirement income solutions which can offer guarantees on capital and income will become even more important now that pension freedoms have come into effect.”
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