Around 1.7 million older people in the UK are living in relative low-income poverty, according to figures from earlier this year. Many pensioners cannot afford to retire, a study has found.
Britons are considering delaying their retirement due to financial stress, a report has shown. Of those 55-year-olds who plan to work beyond retirement age, 37% say they would do so because they need the income to get by in retirement. This is the second-highest proportion in the G7, according to a study by Fidelity.
Retirement planning gaps
Additionally, three in ten of the UK's over-55s describe their retirement planning as poor, compared with 12% in the US. Marianna Hunt, Personal Finance Specialist at Fidelity International, said: "Retirement planning needs to start earlier and prepare people for the possibility that their working lives don't go exactly to plan. A redundancy, health problem or fall in earnings in your 50s can have a significant impact on your retirement finances."
The report also found that the UK ranks last in the G7 for supporting longer working lives. Hunt has stressed the need to "understand how well different countries actually support people to remain in rewarding work later in life".
State pension changes proposed
She said: "What we found is that no country has completely solved the challenge - and the UK ranks last overall. The lesson isn't simply that people need to work longer. It's that working longer should be a genuine choice - and people who want to continue contributing need access to good-quality work that allows them to do so."
The report comes as Prime Minister Andy Burnham announced changes to the state pension in 2030. The newly proposed plans would see the triple lock reduced to a double lock. Under the triple lock, the state pension rises each year by the highest of average earnings growth, inflation or 2.5%. From 2030, Burnham's plans would see the state pension increase every year at least by inflation or 2.5% - but remove the automatic annual link with average earnings.
