Fifty-eight percent of British households are not on track to achieve a moderate retirement income or better, new research has found, with
A moderate retirement income refers to retirees who will receive at least £23,300 annually for a single person and at least £34,000 for couples, according to research by Loughborough University for retirmentlivingstandards.org.uk.
The UK state pension pays out just £141.85 per week, equivalent to £7,376 for a year.
Eight out of ten people currently renting are set to miss out on this minimum income, research from Hargreaves Lansdown suggested, while 54% of homeowners are on track or better.
“Rents have been on the rise, trapping people in a terrible spiral that undermines their financial resilience,” said Helen Morrissey, an analyst at Hargreaves Lansdown.
“Paying higher rent makes it harder to save a deposit so you either don’t get on the housing ladder or you get on it later.”
Single parents are also lagging the moderate pension goal with only 17.5% on track compared to 46% of two-parent households, the report added.
“Single parents are also struggling due to a toxic mix of having to juggle higher costs and finding it harder to find work that fits around child caring responsibilities,” Morrissey said.
“The self-employed also risk being woefully underprepared for retirement as they are not covered by auto-enrolment and are less likely to save into a pension,” the analyst added.
Six months ago, 28% of self-employed workers were on track for a moderate retirement income- this has now fallen to 25.5%.
Hargreaves is the largest independent pension and retirement company, with rivals including AJ Bell PLC (LSE:AJB), Abrdn PLC (LSE:ABDN)'s interactive investor, PensionBee, BestInvest, Moneyfarm, Penfold, Dentons and NetWealth, as well as life insurers Aviva, L&G and M&G.