UK Study: Many Retirees to Have Less $$$ Than Predicted

October 13, 2005 ( - A new study by a British research group has found that while many on retirement will have less money than they expected, the situation shouldn't be as dire as it was once feared.

The Institute for Fiscal Studies (IFS) said in a Web statement that 9.8% of people between 50 and the state pension age could be at risk of having inadequate incomes, according to an ABC News report. The UK’s state pension age is 65 for men and 60 for women.

The IFS study also found that 7.7% of people are not likely to have enough resources to lift them above the minimum income provided by the pensions credit guarantee.

This is in contrast with the figure of between 38% and 43% for those between 46 and the retirement age released by the government’s Pension Commission in its preliminary report on the state of the pensions system in October 2004.

The institute, however, warned that many retirees won’t get as much income from their pensions as they expect, unless they change their savings patterns over the next few years. One of the authors of the report, Gemma Tetlow, said that, at least among older workers, the fraction retiring with inadequate resources may not be as high as the first interim report of the Pensions Commission. “Within the group currently aged between 50 and the state pension age, we predict that around 730,000 individuals in England will have retirement income that is lower than the benchmark used by the Pensions Commission.”

The National Pensioners Convention said nearly 2.2 million older people are living below the official poverty level, and urged the government to address the issue. The group has come out with a pensioners’ charter, which calls for a basic state pension of 123 pounds a week to be paid to all pensioners, as well as free long-term care for elderly people, free nationwide travel on public transport, an annual health check and help to ensure pensions recipients have warm and comfortable homes.