The economic crisis has put a crunch on almost everyone and one of the hardest hit is those that are pre-retirement. In the annual report entitled State of Retirement completed by LV=, one in five of the pre-retirement group is dipping into their pension savings.
The average reduction in the pensions amounted to 324 pounds a month. This has amounted to a pension reduction of UK savings of 18 billion pounds in the past 12 months.
The report also revealed that fewer over 50 years of age pre-retirees are saving enough to maintain a comfortable lifestyle into retirement. Most are hoping for economic recovery to change the forecast of their retirement savings.
One in five men in pre-retirement have reduced their pension by an average of 265 pounds a month, or 23,180 a year. Almost a quarter of all women were cutting theirs by an average of 372 pounds a month, or 4,464 a year.
Ray Chunn, head of pensions at LV=, said “Briton’s over 5o have already seen their pension pots damaged by the economic crisis, and now many appear to be diverting still more money away from retirement savings to deal with immediate pressures.
“We urge those already close to retirement not to give up on saving at such a crucial time. These days there are far more financial options available as you reach retirement age – everything from drawing an income while your pension stays invested to releasing equity from your home.”