A new research from Phoenix Insights, the think tank from Phoenix Group, highlights alarming regional disparities in retirement savings across the UK.
Workers aged over 45 in Greater London and the East of England have more than 40% in retirement savings on average compared to those in the Midlands and the North.
Total savings in these regions average less than £98,000, falling short of the £248,000 estimated by the Pensions and Lifetime Savings Association (PLSA) needed for a moderate standard of living in retirement.
Phoenix Insights conducted a poll with 2,500 workers over 45 across nations and regions in the UK, revealing the stark contrast in retirement readiness across the country. To visualise these regional gaps, the think tank has launched an interactive pensions heatmap which can be found here.
Patrick Thomson, head of research analysis and policy at Phoenix Insights, emphasised the necessity of a diversified approach to address these disparities. He said, “Our research shows that we can’t afford to take a one-size-fits-all approach to solving things. We need to look at better opportunities for employment and savings, and the government’s approach must reflect the needs of all parts of the UK to make a real difference to people’s longer lives.”
The study also revealed that Greater London (£144k) and East of England (£136.7k) have the highest average pension savings amongst UK workers aged over 45, while the North West (£91.4k) and Yorkshire and Humberside (£97.6k) have the least. Regarding cities, Southampton (£144.1k) and London (£133.8k) ranked highest while Nottingham (£78.9k) and Plymouth (£80k) reported the lowest savings.
The research also found that 55% of workers aged over 45 feel uncomfortable discussing their retirement savings plans. A quarter of the participants expressed concerns about not having enough money to live on when they retire. Additionally, over one in seven (15%) do not know where their main source of income will come from when they retire.
In response to these findings, Phoenix Insights calls for the Government to ensure everyone has the tools and support they need to engage with their pension savings earlier, suggesting a regional and local level policy consideration to tackle under-saving.
