Published On: Sat, Dec 16th, 2023

State pension warning as payments ‘fall short’ by over £2,600 despite triple lock rise | Personal Finance | Finance

According to estimates, the state pension will still fall short of around £2,643 of the figure needed for someone to have a basic retirement income.

This calculation is based on the Pension and Lifetime Savings Association’s (PLSA) retirement living standards.

Based on this metric, older households would currently require around £14,144 reach annually before tax.

For context, the maximum amount of the new state pension payment rate is set to go up to only £11,501 next year.

Alice Guy, the head of Pensions and Savings at interactive investor, broke down the reality for many older people.

She explained: “Although the state pension is rising by 8.5 percent in April, it’s important to remember that it still falls far short of the amount needed for a basic retirement income.

“Scrapping the triple lock would lead to millions of pensioners facing a poor old age, as the state pension is currently not enough for even the most basic of retirements.

“Many of today’s pensioners worked during a time of the pension haves and have-nots, when not all workplaces offered a pension.

The retirement expert highlighted just how much certain households are expected to lose out when it comes to pension income.

Ms Guy added: “As a result, 28 percent of over 55s have no pension provision apart from the state pension, according to interactive investor research, released earlier this year.

“For pension savers who are still working, it’s important to know that the state pension alone won’t be enough for a comfortable retirement.

“To achieve a comfortable retirement you will need to supplement the state pension by saving into a workplace or private pension.”

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