This year's retirees to have higher average retirement incomes
Many of the retirement 'Class of 2016' are going to have more money than their recent predecessors.
People approaching retirement within the next year are expected to be 4% better off than those that retired in 2015, according to new research.
Those retiring in 2016 are expected to receive an annual income of £17,700, according to a report by Prudential.
“The third consecutive year of growth in expected retirement incomes is very welcome and underlines increasing confidence among retirees, possibly driven by the introduction of pension freedoms,” says Vince Smith-Hughes, a retirement expert at Prudential. “It is also good to see that more of the ‘Class of 2016’ feel financially well prepared for retirement.”
More than half of people who will retire in 2016 feel financially well-prepared, according to the report from Prudential.
It isn’t all good news though. While people retiring in 2016 will be better off than anyone who’s retired in the past three years, they will still be worse off than those who retired before the financial crisis.
The ‘Class of 2016’ expect to live on £1,000 a year less than those who retired in 2008.
Regional variations
Overall the expected retirement income is rising but when you break the figures down by region the picture is a lot more varied.
Those retiring this year in the south east are expecting a 25% higher income than those in 2015. However, potential retirees in London are expecting to have 22% less than the year before.
|
Region |
2016 |
2015 |
Change |
|
South East |
£21,500 |
£17,200 |
+25% |
|
Eastern England |
£19,000 |
£16,700 |
+14% |
|
North East |
£18,800 |
£17,600 |
+7% |
|
North West |
£17,700 |
£15,100 |
+17% |
|
Scotland |
£17,100 |
£16,600 |
+3% |
|
London |
£16,800 |
£21,600 |
-22% |
|
Yorkshire & Humber |
£16,300 |
£15,000 |
+9% |
|
South West |
£15,900 |
£16,600 |
-4% |
|
East Midlands |
£15,400 |
£15,900 |
-3% |
|
West Midlands |
£15,200 |
£18,000 |
-16% |
|
UK |
£17,700 |
£17,000 |
+4% |
Think about the future now
If you are worried about what you’ll have to live on when you retire then the earlier you take action the better.
“The best way for anyone still in work looking to boost their retirement income is to save as much as possible as early as possible,” says Smith-Hughes.
Earn up to 5% on your savings: compare high-interest current accounts
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