Savings accounts boost pensioners’ incomes by a fifth

15 Nov, 2017

15 Nov 2017   New research from Charter Savings Bank shows how important savings are to retirement planning, as pensioners rely on their cash savings for up to a fifth of their annual income.

Its nationwide study found 77% of retired people use cash saving accounts to generate part of their income in retirement highlighting the importance of ensuring they have the most competitive rates.

On average, respondents say money from their savings – including withdrawals and interest – adds 19% to their annual income, demonstrating the significant contribution that saving regularly makes to the standard of living in retirement.

However, the research also found that less than half of pensioners regularly move their cash to achieve better rates. Despite growing competition among savings providers, just 46% of those surveyed said they monitor the market for the best rates.

Nearly two out of five of those questioned (37%) say they do not move their savings, while another 17% say they look for the best deals but do not move their money regularly.

Paul Whitlock, Director of Savings, Charter Savings Bank says: “Competition in the market is increasing with a wider range of providers offering a variety of competitive savings options.

Given the importance of savings to retirement income, it is safe to say that savers should be reviewing options regularly to look for the best deals. Alongside providing simple straightforward accounts and good service, we are focused on enhancing our range whenever we can.”

Around the country, pensioners in the South West lead the trend and are closely followed by Londoners with 94% and 84% respectively using their savings accounts to boost their income in retirement.

Across its nationwide sample, the research found that retired men are more likely to have savings accounts than women. 83% of those men said they increase their income with savings cash, compared with 72% of women. However, there’s less of a gap when it comes to moving accounts, as 49% of men switch regularly compared with 43% of women.