Newspaper article The Evening Standard (London, England)

Tougher for Londoners to Push out the Pension Boat; Living in the Capital and Heading for Retirement? Simon Read Has Some Shock Statistics for You

Newspaper article The Evening Standard (London, England)

Tougher for Londoners to Push out the Pension Boat; Living in the Capital and Heading for Retirement? Simon Read Has Some Shock Statistics for You

Article excerpt

Byline: Simon Read

LONDONERS are heading for a pension crisis as they could need five grand a year more in retirement than the rest of the country -- but their income is likely to halve when they stop working.

New figures revealed to the Evening Standard show the full scale of the financial disaster facing most of us in the capital. The average amount adults in London say would be enough to maintain a comfortable standard of living during retirement is [pounds sterling]30,579.90 per year, according to wealth adviser Towry, compared with [pounds sterling]25,783.87 across the country.

To get that standard of income, Londoners would need to build up a nest egg of [pounds sterling]706,500 while nationally the figure falls to [pounds sterling]581,000. But analysis by annuity experts Partnership suggests that Londoners can expect their regular income to fall by a half when they retire, 10% more than the UK average.

For those in the City of London the prognosis is even more alarming, with their income set to be 71% less in retirement.

However, that's mainly because the average employment income in the capital is considerably more than elsewhere in the country.

The average across London is [pounds sterling]23,100 while in the City it soars to [pounds sterling]57,600. Pension income across London will fall 48% to [pounds sterling]12,000. In the City, it will slump 71% to [pounds sterling]16,800.

Across the country, the average fall is 39%. In the North, it's about 36% and in Wales just 33%, meaning the financial shock of retirement will be much less dramatic. Even in Newham in East London, which has the lowest average employment income in the capital of just [pounds sterling]17,800, the retirement gap is still higher than the national average at 41%.

The figures point to the importance for most Londoners of planning for the day you retire to ensure that it doesn't prove to be a massive financial shock.

"Many of those in London who think they are on track with their savings could be advised to commit more of their finances to their pension pot if they want to get near to maintaining their current lifestyle in retirement," Chris Cole of Towry warns. …

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