Just over two in five (41.7 per cent) households are now on track for a moderate retirement, down from 42.6 per cent in July 2022, Hargreaves Lansdown’s Savings and Resilience Barometer has revealed.

The analysis also featured a breakdown of the figures depending on financial quintile, reporting that 11.6 per cent of households in the lowest income quintile are on track for a moderate retirement, slightly up from the 11.7 per cent recorded in July, whilst 71.1 per cent of the top fifth earning households are on track, down slightly from 71.8 per cent.

However, whilst more top earners may be on track for a moderate retirement, Hargreaves Lansdown warned that, given they are top earners, a moderate retirement income may not meet their expectations.

Middle earners were discovered to be the most affected, with less than a third (32.3 per cent) on track for a moderate income, a fall of 2.2 percentage points on the 34.5 per cent reported in July.

Commenting on the findings, Hargreaves Lansdown senior pensions and retirement analyst, Helen Morrisey, stated: “Our retirement resilience is showing serious signs of slipping as the cost of living continues to play havoc with our finances.

“As more people struggle to pay their day-to-day bills this has a knock-on effect to the amount we can afford to put away for tomorrow.

“Added to this, soaring energy and food prices have pushed up the cost of living for a moderate income in retirement according to the Pensions and Lifetime Savings Association - it’s a miserable situation."

Morrisey went on to point out that, whilst the state pension is due to rise by 10.1 per cent from April, this will cover some of the increase from inflation but not all of it and that the rest will need to be made up from increased savings, but that the reality is that right now many people are in no position to boost pension contributions.

Share Story: