Bringing you live news and features since 2006 

UK expected retirement income hits six-year high, says Prudential

RELATED TOPICS​

Expected retirement incomes have hit a six-year high with people planning to retire this year expecting to be nearly eight per cent better off than those who stopped working in 2014, according to research by Prudential.

As the changes to pensions and saving regulations start to take effect and confidence in the economy continues to grow, the insurer’s research has found that those planning to retire in 2015 have an average expected annual retirement income of GBP17,000 per year – on average more than GBP1,200 higher than last year’s retirees. The figures come from Prudential’s eighth annual ‘Class of’ study, which tracks the future plans and aspirations of people planning to retire in the next 12 months.

The figures paint a picture of significant regional variation in retirement expectations for the ‘Class of 2015’, although there is an increase in expected retirement incomes in all but two of the regions Prudential reports on.

The North East of England saw expected incomes increase by more than a quarter (27 per cent), with large increases also seen in the South West of England (19 per cent), the West Midlands (18 per cent) and London (17 per cent). Meanwhile, those planning to retire in Scotland in 2015 expect an income that is seven per cent lower on average than those who retired last year.    

Despite the increased optimism among the ‘Class of 2015’, expected retirement incomes are still GBP1,700 a year lower than the GBP18,700 expected by the ‘Class of 2008’, and GBP800 a year lower than the GBP17,800 income expected by the last of the pre-financial crash retirees in 2009.

Vince Smith-Hughes, retirement expert at Prudential, said: “Some of the increase in expectations we’re seeing could be attributed to the media coverage over recent months on the changes in the pension rules that will come into effect from April 2015. The challenge for providers and advisers is to help these pensioners to plan properly in order to benefit from the new freedoms and secure the best retirement income arrangement to suit their needs.

“The rule changes don’t alter the basic principle of needing to secure an income that will last throughout retirement. The best way to secure this is for people to save as much as possible as early as possible in their working lives. Consulting a financial adviser or retirement specialist well before giving up work can help savers to manage their retirement income expectations appropriately.

“It is encouraging that as economic confidence returns, our research continues to show a welcome upward trend in expected retirement incomes since the low point of two years ago. This is only the third time since we started researching retiree attitudes back in 2008 that we have seen income expectations rise.”

Latest News

ETF data consultant ETFGI reports that assets invested in the global ETF industry reached a new record of USD12.71 trillion..
Calastone has published an ETF white paper which examines several of the processes that take place across the lifecycle of..
Adapting product lines to fit into changing methodologies and meet shifting demand is essential to remaining relevant in the industry..
Investors urgently need greater access to diversified investment strategies aligned with the Paris Agreement on climate change if the world..

Related Articles

Taylor Krystkowiak, Themes ETFs
Themes ETFs opened its doors in December 2023, with an introductory suite of 11 ETFs – seven thematic and four...
Konrad Sippel, Solactive
At the end of March, financial index specialist, Solactive, published its 2024 annual report on future trends.  ...
Lorraine Sereyjol-Garros, BNP Paribas
Following changes to the French Monetary and Financial Code and of the French market authority AMF’s General Regulation, it is...
Ed Rosenberg, Texas Capital
Texas Capital Bank first opened its doors back in December 1998 and nowadays offers wealth-management services, as well as commercial,...
Subscribe to the ETF Express newsletter

Subscribe for access to our weekly newsletter, newsletter archive, updates on the site and exclusive email content.

Marketing by