Falling short in retirement
An analysis of actual current pension benefits conducted by financial services provider MetLife Europe has revealed that the average pensioner couple’s income from private pensions is more than £8,500 below the ideal of two-thirds final salary.
The average couple receives a pension of just £7,696 a year from their private pensions, with the result that pensioners are suffering a significant decrease in their standard of living when they retire. Currently, the average UK salary is just over £24,300, which means a pension of £16,201 is needed to receive two-thirds of this average salary. In reality, the average couple receives less than half this sum.
Rosy Atal, head of marketing at MetLife Europe, comments that, ‘Far too many pensioners see an overnight drop in their standard of living the day they retire. If pensioners are to enjoy a reasonable standard of living then it is vital that they save more in their working years.’
She points out that, ‘Our analysis also shows that pensioner couples draw just £20 a week from personal pensions, which is an incredibly low figure. Pensioners will have to rely much more on their personal pension savings going forward as occupational schemes decline in value.’
The existence of such a “pension gap” is supported by research carried out by MetLife earlier this year, which revealed that only 32 per cent of people aged 54 to 65 believe that they will have enough income in retirement. Nearly one in five expected a monthly shortfall, of which nearly 130,000 expected a shortfall of over £1,000 a month. Half of those in this age group were unsure if they would face a shortfall.

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Top Ten Life Funds
| Fund | Offer | 1y | 3y | 5y |
|---|---|---|---|---|
| UBS Life Structured Credit A | 91.43 | 294.1 | n/a | n/a |
| Skandia Finland FIM Russia | 11.14 | 70.1 | -11.0 | 66.2 |
| Zurich American Property AL G4 | 43.20 | 67.9 | 22.9 | 28.7 |
| Skandia Finland Alfred Berg Ryssland | 0.87 | 63.2 | -21.3 | n/a |
| Skandia Finland JPM New European | 2.11 | 57.6 | -18.2 | 61.1 |
| Merch Inv Sanlam Global Financial S6 | 109.40 | 56.1 | n/a | n/a |
| Skandia Norway Alfred Berg Ryssland | 0.87 | 50.7 | n/a | n/a |
| AXA Jupiter Emerging European Opportunities | 221.10 | 50.7 | -10.3 | n/a |
| Winterthur JPM New Europe | 193.50 | 50.4 | n/a | n/a |
| AXA Jupiter Emerging European Opportunities PSB | 2.21 | 49.2 | -5.1 | 58.5 |
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