More than 1.2 million people across the UK are heading into retirement with a significant financial gap, as new figures reveal a heavy reliance on the state pension.
The Scale of State Pension Dependence
Analysis of official data by retirement specialist Just Group has uncovered a stark picture. It shows that approximately 740,000 single retirees and 500,000 retired two-adult households are classified as "mainly reliant" on income from the state. In total, this represents more than 1.2 million individuals whose financial security in later life hangs in the balance.
The Office for National Statistics (ONS) defines these households as those where at least three-quarters of total income comes from the state pension or similar pension-related benefits. This highlights a vulnerable segment of the population with little additional private savings or pension provisions to fall back on.
The Growing Income Gap in Retirement
The core issue is that the state pension falls far short of the income considered necessary for a basic standard of living. According to the Pension UK Retirement Living Standards, a single pensioner requires around £13,400 per year to achieve a "minimum" lifestyle.
Currently, the full new state pension is worth £230.25 per week, or roughly £11,973 annually. This creates a worrying shortfall of £1,427 every year for those trying to meet the minimum standard. On a monthly basis, pensioners reliant solely on the state pension would need to find an extra £119 or drastically tighten their budgets.
David Cooper, a director at Just Group, commented on the findings. "The data from the ONS highlights the significant number of pensioners who are mainly dependent on the state pension and other benefits to support them throughout retirement," he said.
"Pension UK’s minimum income standard is nearly £1,500 higher per year than the current state pension and demonstrates the gap that hundreds of thousands of retirees need to bridge."
Bridging the Pension Gap
For many in this position, returning to work is not a feasible option. Experts therefore stress the critical importance of checking eligibility for additional financial support. Unclaimed benefits could provide a vital lifeline for those struggling to make ends meet.
"For many, this extra income could significantly improve retirement living standards, so it’s vital people check if they’re eligible for unclaimed support," advised Mr Cooper.
The state pension does increase annually under the triple lock guarantee. This policy ensures it rises each April by the highest of three measures: earnings growth, inflation (as measured in September), or 2.5%.
From April 2026, the state pension will rise by 4.8%, in line with wage growth. This will increase the full new state pension from £230.25 to £241.30 per week. The old basic state pension will rise from £176.45 to £184.90 weekly.
To receive the full new state pension, individuals typically need 35 years of qualifying National Insurance contributions. Those planning for retirement are urged to review their contribution record and seek professional guidance to understand all their potential income sources.
