Nearly a third (31 per cent) of people below state pension age expect it to be their main source of income when they retire, despite more than half of savers stating that this won't be enough for a comfortable retirement, research by Royal London has revealed.

The research, which included a survey of 4,000 people, found that nearly four in ten (39 per cent) of those aged 55 or over expect the state pension to be their primary source of income in retirement.

Royal London found that those aged 55 and over are also most likely to have the state pension as a main source of income, at 51 per cent, compared to 25 per cent of those aged 18-34.

However, the research suggested that there is a shortfall in people’s expectations for retirement, as while respondents stated that they would need £1,117 a month on average to live comfortably in retirement, the new state pension pays up to £802, representing a “shortfall” of £315 per month.

The survey also found that more than half (52 per cent) of respondents don’t think they would be able to live comfortably in retirement if the state pension was their sole income.

Additionally, Royal London revealed that workplace pensions are expected to be the main source of retirement income for many people, with 38 per cent of respondents choosing it.

Commenting on the findings, Royal London consumer finance specialist, Sarah Pennells, warned that those relying on the state pension as their main or only source of income will "undoubtedly find budgeting extremely difficult", with rising costs adding to the pressure.

“It’s important that everyone gets a pension forecast from gov.uk to show how much state pension you’ll receive when you retire as you may not be entitled to the full amount," she continued.

“Planning for retirement may not be a top priority when day-to-day costs are spiralling, but it’s also important to look at how much income any workplace or private pensions could generate on top of your state pension and see if there's a gap between the life you’d like when you retire, and the life that’s affordable.”

Share Story: