Richest retirees have an income 17 TIMES bigger than poorest – and gap has almost doubled since 2010
- Poorest retirees’ private pensions pay £2,260 a year, and richest get £38,940
- Pension incomes rose 54% for poorest since 2010, while richest saw a 74% rise
- Gap has widened from £20,950 in 2010-11 to £36,680 in 2018-19
The pension incomes of Britain’s richest retirees are now 17 times higher than those of the poorest as the gap between the two has nearly doubled over the past decade.
While all pension savers have seen their incomes rise substantially since 2010, the bounce masks a widening gap between those at the top and those at the bottom, according to analysis of official figures by investment platform AJ Bell.
The poorest retirees received £2,260 a year in private pension payments in the last financial year, compared to £38,940 received by the richest retirees.
Pensions income gap: While all pension savers have seen their incomes rise substantially since 2010, the bounce masks a widening gap between those at the top and those at the bottom
Pension incomes have risen across the board, but the richest pensioners have seen them rise at a much faster pace than the poorest.
The bottom fifth of retired households saw pension incomes rise 54 per cent since 2010, while the top fifth saw a much larger 74 per cent rise.
It means that in cash terms, the gap between the pension incomes of the bottom fifth of savers and the top fifth has almost doubled, from £20,950 to £36,680, AJ Bell said.
‘It has become increasingly clear in recent years, and particularly in the aftermath of the EU referendum, that the UK is a divided nation, with the better off getting even better off as large sections of the population struggle to make ends meet,’ said Tom Selby, a senior analyst at AJ Bell.
‘We truly live in a nation of pension “haves” and pension “have nots”‘, he added.
The bottom fifth of retired households saw pension incomes rise 54 per cent since 2010, while the top fifth saw a much larger 74 per cent rise
Back in 2010, the bottom fifth of retired households drew a retirement income of £1,472 a year – 15 times smaller than the top fifth, who received £22,422.
Overall, average private pension incomes have risen from £8,134 in 2010 to £14,756 in the 2018-19 financial year. Meanwhile, the full basic state pension is currently £8,800 a year.
Selby added: ‘While automatic enrolment should help future retirees avoid penury in their later years, for most people it will only serve to provide a basic level of income in retirement.
‘And with no guarantees of how much the state pension will be or when it will be received in the coming decades, anyone wanting to avoid becoming a pension “have not” needs to take responsibility by saving as much as they can afford today.’
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