Money Wellness
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category iconbenefits
calendar icon10 Apr 2024

Millions over 50 at risk of poverty in retirement

Almost 7 million people aged over 50  don’t have a private pension, which puts them at risk of retirement poverty, according to the latest analysis by SunLife.

The new state pension is increasing by 8.5% to £221.20, but SunLife says that this falls short of  needed for pensioners to get by, let alone live well, especially with the data showing that 20% of men over 50, and 33% of women over 50 are relying on it to fund their retirement.

The Retirement Living Standards updated its calculations for what an individual needs for a ‘minimum standard of living’ in retirement earlier this year. It was  an annual income of £12,800, but now stands at £14,400.

But SunLife says that even on previous calculations, those living on the state pension alone were more than £2,000 short of being able to fund their basic needs in retirement. With the increase taken into account, the hike in living costs means they will be almost £3,000 short.

This means they’ll be £55 short of money a week.

With more than a quarter (27%) of over 50s relying on the state pension to live, this puts almost 7 million people at risk of retirement poverty, SunLife concludes.

Mark Screeton, CEO at SunLife, said “It is really worrying that so many over 50s – particularly women – are relying on the state pension alone to fund their retirement. That level of income is nowhere near enough to sustain even a basic standard of living, let alone a lifestyle that most people would call ‘enjoyable’.”

92% of over 50s are worried about money

The research found that of the over 50s with no private pension savings, 92% are worried about money, while 39% are worried about running out of money during retirement.

Those who haven’t retired are the most concerned with the data showing 43% of over 50s still working saying they’re  worried they won’t have enough money to fund their retirement, rising to 44% of those who do not have any private pension savings.

Even over 50s  who do have a private pension, 86% of them have money worries with 69% worrying about the cost of living, and 36% about running out of money during retirement.

Over 50 and struggling financially?

If you claim the state pension, you may also be entitled to pension credit and other associated benefits to top up your income.

Pension Credit

Pension credit is a benefit for people on low incomes who have reached state pension age. There are two parts to pension credit:

  • Guarantee credit – this tops up your weekly income to a guaranteed minimum amount
  • Savings credit – this is an extra boost for people who have

One in three people who could get pension credit don’t claim it. If you’re over state pension age and on a low income, you could be missing out on over £3,000 a year. Use the government’s pension credit calculator to find out if you qualify.

Avatar of Lydia Bell-Jones

Lydia Bell-Jones

With a background in banking, Lydia has been writing professionally for over five years. She is passionate about helping people improve their personal finances and has a particular interest in the connection between money and mental health.

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