UK workers are dipping into their retirement savings to meet other living costs, according to a report by insurance giant Aviva.

Aviva found that nine out of ten people aged over 55 had to sacrifice their retirement savings to meet unexpected expenses.

Increased living costs were also a major issue, with 64 per cent saying they were worried – this represented an increase of 18 per cent compared to last year.

With increased living costs, Aviva’s Real Retirement report worryingly found that for today’s 17.6m over 55s, each year of retirement is funded by just under two years of work. Aviva said that this is a difficult imbalance, considering that people today are spending an average of 44 years in work and 25 years in retirement.

Based on the findings, the insurer said it was unlikely that people today would be able to enjoy an early retirement at age 60.

Clive Bolton, director at Aviva, commented: “Many over 55s are worried about maintaining their standard of living and as today’s average retiree is looking to finance every year of their retirement with just under two years of work, these fears are justified. This financial equation is very worrying and simply doesn’t add up.

“The equation becomes even more concerning, when you realise that the average person starting work today will live for longer – thus reducing the ratio of working years to years spent in retirement even further,” he added.

Share Story: