Pensioner households need a basic £20,000 a year in income for a comfortable retirement, analysis from ISIPP has found, although the provider warned that inflation is placing a growing pressure on pensioner finances.

The provider's analysis revealed that retired households aged between 65 and 74 spend £383 a week adding up to £19,936 a year.

Based on this, ISIPP warned that households relying on the full flat-rate state pension alone, which is currently worth £9,627.80, could face a £10,300 shortfall.

It also noted that, despite a record increase in the state pension planned, those on the state pension will likely still be struggling when it increases to £203.85 a week or £10,600.20 a year from April next year.

In light of this, the provider warned that the current high levels of inflation will likely continue to place pressure on pensioner households, with total spending for pensioner households expected to be stretched.

ISIPP managing director, Hrishi Kulkarni, stated: "The cost-of-living crisis is affecting all households with inflation eating away at budgets and making it harder to maintain standards of living.

“Analysis shows retired households need at least £20,000 to maintain a decent standard of living which is challenging for those who have not managed to maximise retirement savings.

"The state pension is a valuable safety net and the increase next year under the triple lock is very welcome, but people need to focus on building as big a pension pot as possible.

"It has become even more important for all of us to think how can we put more towards our pension by regularly contributing in addition to consolidating all pensions into one.”

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