People in their 80s and 90s are particularly squeezed by pension trends, according to major new research.
A dire warning over the health of pensioner finances in the UK was released by the Pensions Policy Institute (PPI) today.
In a major report entitled Retirement Income and Assets: Do pensioners have sufficient income to meet their needs?, the respected industry group indicated that pensioners have less and less to live on the older they get, relative to the rest of the working population. This is due the fact that pensions levels increase in line with prices rather than earnings.
The PPI also showed that retirees' own expectations for their personal income level during their retirement changes over time. Specifically, higher rates of disability, loss of spouses and increasing care needs mean that those in their 80s and 90s need more money than those in their 70s - despite facing a proportionally lower income.
Niki Cleal, PPI director, said: "Pensioners may not have sufficient resources to meet all of their extra needs in later life, such as to meet the additional costs of disability, widowhood or the need for long-term care and to maintain their desired standard of living. This research shows that pensioners will need a range of assets and sources of income to help them cope with the uncertainty and extra costs they may face later in their life as a result of the onset of disability, widowhood or the need for long-term care."
According to insurer Alliance Trust, elderly people face far higher inflation rates than the general population. A recent report from the firm argued that the rate of price rises faced by over-75s was 53 percent above the average rate, due to the higher proportion of income spent by this age group on food and fuel.
