Personal Pension  

Annual cost of being a pensioner is £11,620

Annual cost of being a pensioner is £11,620

The average annual cost of being a pensioner amounts to £11,620 a year, according to analysis by provider Key Retirement.

Food, clothes, travel and heating all constitute a weekly £223 per head bill, analysis of government figures on household expenditure shows.

This is around £3.75 per cent up on last year for the UK as a whole – the equivalent of £420 a year or £8 a week – but the average cost has fallen in Northern Ireland and the West Midlands and is virtually unchanged in London and the South East.

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According to Key Retirement, the annual average for the country as a whole conceals huge regional variations, with retired people in Wales needing £9,990 a year compared to £13,270 in the South East – around £3,280 a year less or 25 per cent lower.

Dean Mirfin, technical director at Key Retirement said: “The basic cost of being a pensioner at around £11,620 a year underlines the need for extra income, which is well in excess of the basic state pension.

Last February, the firm put the average yearly cost of being a pensioner at £11,200 a year.

Pensions minister Baroness Ros Altmann addressed the House of Lords earlier this year with news the state pension will see its biggest real-term increase in 15 years from April, 2016, up by 2.9 per cent – or £3.35 – to £119.30 a week.

This is being done under the government’s ‘triple lock’ of the state pension, which means it goes up by the highest of earnings, prices or 2.5 per cent. Over 2016, the increase in average earnings has been 2.9 per cent, more than inflation and more than 2.5 per cent.