A fifth of people approaching retirement will suffer large income falls and should expect to have to rely on savings and inheritances when they stop working, a report has found.
Analysis from the Institute for Fiscal Studies said the majority of people currently aged between 50 and the state pension age will have a replacement rate of less than 80% - meaning their income will drop by 20% when looking at pension income. It also said more than 40% will have a replacement rate less than two thirds. Meaning their income will drop by at least a third. The study added when other sources of income are factored in - including savings, expected inheritances, pension credit and the return owner-occupiers get from their homes - retirement replacement rates are not as ba...
To continue reading this article...
Join Professional Adviser for free
Signup and gain exclusive members-only insights
- Unlimited access to real-time news, industry insights and market intelligence
- Stay ahead of the curve with spotlights on emerging trends and technologies
- Receive breaking news stories straight to your inbox in the daily newsletters
- Make smart business decisions with the latest developments in regulation, investing retirement and protection
- Members-only access to the editor’s weekly Friday commentary
- Be the first to hear about our events and awards programmes
