MetLife highlights ‘uncertain generation’

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Squeeze on savings

The average British 50-year-old has under half of the retirement savings they will need to guarantee a minimum standard of income when they stop working, MetLife has claimed.

Its research into the finances of 50-year-olds indicates they have an average of £54,300 saved in pension funds. However, to meet pensioners’ minimum annual income standards of £14,400 including the State Pension they need around £122,800 by the time they retire.

That leaves a gap of £68,600 to fill – and the gap is wider for 50-year-old women who have an average £38,500 saved compared with £74,200 for men.

The gap is just an average: around 41% of 50-year-olds admit the State Pension will be their main source of income in retirement and 26% say they have less than £20,000 saved.

Meanwhile, the average 50-year-old with a mortgage outstanding is five times more likely to prioritise paying it off, while those with children are 20% more likely to focus on their children’s financial well-being.

MetLife has dubbed those those born between 1961 and 1981as ‘the uncertain generation.

“Around 868,000 people will turn 50 this year, 32,000 more than last year,” explained Dominic Grinstead, managing director of MetLife UK. “Someone in the UK turns 50 every 40 seconds but they are far less financially secure than their predecessors. The uncertain generation has complex financial needs but are facing unprecedented pressures.

“They accept that they will have to retire later than anticipated, but are still uncertain about exactly how young they will be able to do so. Currently the average 50-year-old is a long way off the pension required to be financially comfortable after work. As a result, retiring before 60 is highly unlikely for most.”

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