The number of single pensioners who are completely reliant on the state pension for income in retirement has jumped by a quarter over the past five years as individuals continue to fall short on saving.
Around 1.1m single pensioners are solely reliant on the state for financial support, an increase of 26 per cent over the five year period to the end of 2016, and a 15 per cent jump in the 12 months to 5 April last year.
Data from the Department for Work and Pensions also showed that an additional 330,000 pensioner couples live solely off the state pension, income related benefits and disability benefits.
The average amount of weekly income from a state pension, including income benefits, for single pensioners in 2015/16 was £188, which costs the taxpayer around £850m per week to fund the 4.6m single pensioners.
Stephen Lowe, group communications director at specialist retirement services provider Just, said this reliance on the state pension demonstrated the need to encourage individuals to plan ahead for their retirement.
“The State will never provide a retirement income that allows for many comforts, so for those who do have some savings, good guidance about what to do with those savings is vital.
“Poor decisions can quickly erode savings and despite their best endeavours people will find themselves reliant on whatever the State can provide.”
Mr Lowe encouraged consumers to use Pension Wise, the government’s impartial and free to use guidance service, to help them make better decisions about saving.
julia.faurschou@ft.com
