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Barnett Waddingham
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Impressively large disposable income for retired households

Published on

Malcolm McLean, Senior Consultant at Barnett Waddingham, said; “The growth in the average annual disposable income of retired households, over the last 40 years, is impressively large. The fact that over half of the increase is attributed to a sevenfold increase in private pension alone is very significant. This shows the value of making private pension provision and not relying on the state pension alone.

“That said, there still has to be a concern about the levels of income inequality that exist between individual households, particularly so in a comparison between ‘the haves and the have nots’ when it comes to pension provision being made.

It is important that today’s workers are encouraged to take advantage of being auto-enrolled.

“Although looking at the picture in the round it is clear that much progress has been made over these last 40 years. However, there is still much to do to maintain progress, and avoid slipping backwards, in relation to retired household incomes.

“It is important that today’s workers are encouraged to take advantage of being auto-enrolled into a workplace pension scheme and start saving at the earliest possible ages. As a matter of urgency, we must continue to strive to find a way to bring the self-employed into the process.

“If the pensioners of tomorrow are to going to catch up with, and at least match, those of today there can be no room for complacency in addressing these issues.”

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