Welcome to this monthly Accounting News bulletin from DG Accountancy Services (http://www.businessbods.co.uk) bringing Small Business' news and information from the business world, as it happens!
Tuesday, 5 August 2008
The average UK worker is likely to see their income fall by 53% upon reaching retirement, new research suggests. According to retirement institute Fidelity International, many workers will see their total income, including state and private pensions, drop to £215 a week - less than someone earning the current national minimum wage. Meanwhile those saving in defined contribution schemes, where retirement income is tied to contribution levels and investment performance, are expected to receive just 38% of their final salary in retirement. Despite the apparent gloomy outlook, these latest statistics represent the first improvement recorded in three years. The study also suggests that those participating in final salary funds face more positive prospects, with members on course to retire on two-thirds of pay after 40 years of service. Simon Fraser, president of the retirement institute at Fidelity International, said: ‘The move from final salary defined benefit schemes to defined contribution is often accompanied by a review of contribution levels. ‘If this is not corrected, we could see the emergence of a generation of private pension paupers.’ If you would like help planning for your retirement, please contact us.
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