Many savers are not going to have enough money to live on when they retire, Hargreaves Lansdown has said.
Independent Financial Advisor (IFA) Hargreaves Lansdown has released new retirement savings data, showing what it terms "car crash" conditions in the sector.
According to figures cited in the report, the number of people putting money aside in pension plans has dropped from eight million to seven million over the past year, as the credit crunch puts the squeeze on many people's personal finances. The IFA also warned that savers needed to double their current pension provisions if they were to enjoy a comfortable retirement.
This problem has been worsened, Hargreaves Lansdown claimed, by a move in the occupational pensions sector away from final salary schemes, and in to less generous defined benefit schemes.
Figures from the Office of National Statistics show that the average private pension income, including workplace savings, comes to around £3,000 a year for a single man. However, under current annuity rates, a man retiring in 2007 would generate just £1,380 in income from his pension pot.
Tom McPhail at Hargreaves Lansdown commented: "A minority of private investors are funding their own pension adequately, very often with the help of their employer.
"For millions of people though, the UK's retirement provision is beginning to resemble a car crash in slow motion."
