A report from Hargreaves Lansdown/Oxford Economics has found that just 42.7% of households are on track to achieve a pension income in retirement of £20,800 pa for a single person and £30,600 pa for a couple. This is a target figure set by the Pensions and Lifetime Savings Association as an adequate income in retirement. These targets also include a full state pension of £9,340 pa per person.
42.7% is broadly similar to 2019 figures but with inflation climbing, the number of households likely to be on target is set to fall to just 38%.
This has been a tough one for successive governments for decades. We do not save enough; we receive little or no financial education. We learn about Pythagoras, Boyle’s Law and Newton’s 3 laws at school, which come in handy for some but bank accounts, saving, mortgages, pensions and taxes are something that we all need to grow up with and understand how important they are in life.
Financial education is key and both the financial industry and the government owe it to future generations to have better financial awareness education and training.