UK workplace pension savings statistics for those about to retire has fallen at an alarming rate according to research published today.
The median amount of occupational pension savings has plummeted more than one third in total, from £106,000 to just £71,000 over past two years for those aged 55-64, according to analysis from Equiniti
The research, highlighted on the table below, points to a reliance on UK State Benefits appears as a probability for millions. As a result, Equiniti - one of the UK's largest pension administrators - has urged UK citizens to plan ahead for their retirement and to try and build up savings from as young an age as possible
"It is alarming to see so many people within ten years of reaching the State Pension Age are looking likely to enter retirement with so little reserved in their occupational pension savings," - Duncan Watson, CEO of Equiniti's pension business.
Median occupational pension savings for 55-64-year-olds had remained relatively constant between 2008 and 2012, hovering around £98,000 and £99,000 before rising to £115,000 and £106,000 in 2012-14 and 2014-16, respectively.
However, in 2016-18, average savings have collapsed falling to just £71,000 for this age group, decreasing by over 38% or £44,000 since the peak in 2012-14. It raises fears that millions could enter retirement without the means to sustain themselves and leave them relying on State Benefits to cope financially.
The 25th percentile of pension savers shows an even bleaker picture with at least a quarter of 55-64-year-olds having built up savings of just £8,500 ahead of their retirement, a figure which has more than halved from £20,700 in 2014-16.
The advent of auto-enrolment in 2012 and the introduction of DC pension freedoms in 2015 may also have had an impact according to Duncan Watson, CEO of Equiniti's pension business.
"It is alarming to see so many people within ten years of reaching the State Pension Age are looking likely to enter retirement with so little reserved in their occupational pension savings," said Watson.
"Innovation through auto-enrolment and pensions dashboards will transform the pension industry in this country, but this will be of little comfort for those whom will largely be unable to benefit from the reforms.
"Nonetheless, it should act as a warning light for those just starting out in their careers and on their pension-saving journey."
Watson added that while starting to contribute to a pension is "the hardest part" as individuals sacrifice a chunk of the monthly pay-cheque, but it will "become second nature" and will make a huge difference to the quality of life people can afford forty years down the line.
"Your future self will thank you," he added.