Less than half (48 per cent) of mid-retirees (aged 65-75) are confident they are on track to make their private pension savings last for life, a report from Aviva has revealed, prompting calls for the introduction of a 'mid-retirement MOT'.

The research, produced in partnership with Age UK, surveyed 1,000 mid-retirees aged 65-75 with a private pension and found that just 26 per cent felt 'financially secure'.

This comprised 19 per cent of women, compared to 32 per cent of me, in a clear representation of the gender pensions gap.

In addition to this, whilst the majority (83 per cent) said income from their private pension savings has become more important to them as they get older, and the same number said they would be worried if their retirement income fell, women were more likely to feel this way than men (87 per cent compared to 79 per cent).

Meanwhile, the survey found that nearly two-thirds (64 per cent) thought a private pension should provide an income for life rather than function as a flexible savings account.

Furthermore, a similar number (65 per cent) suggested that there was insufficient support for people managing their financial needs as they age.

Aviva and Age UK said the findings highlighted a "new and pressing need" for regular financial reviews within retirement and called for the introduction of a "mid-retirement MOT", which could offer pensioners guidance and support while in retirement.

The pair said the MOT could act as a financial and lifestyle review that could include a conversation about estate planning, fraud protection, access to state benefits, and managing finances if they start to experience cognitive decline.

The study also recommended that innovative 'flex first, fix later' retirement income solutions - blended approaches that combine pension drawdown strategies with a later-life annuity – should become the norm.

Aviva CEO of insurance, wealth and retirement, Doug Brown, claimed that many pensioners were "sleepwalking" into later retirement with a "set and forget approach" to their income.

"They are among the first retirees getting to grips with the complex decisions that come with pension freedoms and need more support to make choices that will work for the whole of their retirement years," he added.

Brown highlighted modelling by the Pensions Policy Institute (PPI), which showed that mid-retirees over 75 who withdrew from a £100,000 pension pot at a rate of more than 7 per cent were at 'significant risk' of depleting pension pots prematurely, with a 10 per cent withdrawal rate expected to 'exhaust' pension pots in 13 years.

"Choosing to withdraw a private pension at a rate of more than 7 per cent from the age of 75 requires strict financial discipline to make that money last," he continued, stating: "There is a real danger that pension pots will run out too soon without the right advice and guidance in place, and there is a realistic chance that future pensioners will be managing money into their 90s and beyond, facing major challenges that could include the cognitive decline that often comes with age.

“There is a realistic chance that future pensioners will be managing money into their 90s and beyond, facing major challenges that could include the cognitive decline that often comes with age.

"That’s why we are working with Age UK to consider the feasibility of a mid-retirement MOT pilot to help us understand how the industry can better support people to manage their money for a secure, fulfilling later life.”

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