One in four pensioned couples live off £15k or less
In 2010 / 2011 some 27% of pensioner couples had a total annual income of less than £15,000 while 45% of single pensioners had total pension income of less than £10,000 a year.
Martin Dodd, pension expert at the Midlands Investment Agency, said the figures show the “sad truth” of the big cut in income that retirees face at the end of their working life.
He said: “For pensioners, austerity isn’t a fad. It’s a way of life, imposed on them by plummeting annuity rates and puny interest rates.
“Those approaching retirement face a classic Hobson’s Choice – locking into a meagre annuity rate or working for a few more years in the hope that things will improve.”
And as annuity rates continue to fall Dodd points out hopes for a recovery are misplaced.
He said: “Annuity rates have been falling for more than a decade and the Bank of England’s quantitative easing money-printing programme has sped up that decline.
“The result is that even those who have saved hard will find that their pension pots won’t go as far as they had hoped.”
Dodd added that those people still in work are saving any spare cash they can “for a rainy day”, rather than putting it into pension.
He said: “While it is prudent to build up a reserve for emergencies, getting out of the habit of saving in a pension is deeply risky.
“These figures should be a wake-up call to anyone who isn’t saving into a pension. For an ever-growing number of pensioners, old age is as grim as it is grey.”