Inflation rates have left state pensioners and retireesover £9,000 worse off per year compared to 2010.
State pensioners have been warned they face a £9,000 “real-terms” shortfall as inflation continues to bite retirees. Inflation rates have left state pensioners and retirees over £9,000 worse off per year compared to 2010.
Despite a modest rise, the average pensioner income now sits at £407 per week—just £15 more than in 2010, new figures have shown. Adjusted for inflation, pensioners should be receiving nearly £180 more per week to maintain the same standard of living.
In 2010, the average pensioner income was £392 per week, which would be worth £586.76 today, according to the Bank of England’s inflation calculator. It means today’s pensioners are missing out on £179 per week.
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Thomas Lambert, financial planner at Quilter, warned: “When compared to the steep rise from £206 in 1995 to £392 in 2010, it is clear there has been a marked slowdown despite the considerably higher cost of living.
“This decrease highlights the impact of rising incomes from the state pension and private pensions, reducing eligibility for benefits. Unsurprisingly, single pensioners were much more reliant on this state support to bolster their pension income.”
Helen Morrissey, head of retirement analysis at Hargreaves Lansdown said: “Average pensioner incomes have hit £407 per week—a huge uplift since the £206 recorded back in 1995. However, growth has tailed off in recent years.
“Back in 2010, it was £392. There’s lots of reasons for this—for a start, pensioner take-up of income-related benefits has dwindled over the years. One in five pensioners receive them now compared to 37 per cent back in 1995.”
She said: “Rumours continue to swirl around whether the triple lock will remain, and such uncertainty can undermine people’s confidence in the system.
“Putting the state pension on a firm long-term footing is vital to build this confidence and should be considered as the government assesses adequacy issues during the second part of its Pension Review.”
