Our website publishes news, press releases, opinion and advertorials on various financial organizations, products and services which are commissioned from various Companies, Organizations, PR agencies, Bloggers etc. These commissioned articles are commercial in nature. This is not to be considered as financial advice and should be considered only for information purposes. It does not reflect the views or opinion of our website and is not to be considered an endorsement or a recommendation. We cannot guarantee the accuracy or applicability of any information provided with respect to your individual or personal circumstances. Please seek Professional advice from a qualified professional before making any financial decisions. We link to various third-party websites, affiliate sales networks, and to our advertising partners websites. When you view or click on certain links available on our articles, our partners may compensate us for displaying the content to you or make a purchase or fill a form. This will not incur any additional charges to you. To make things simpler for you to identity or distinguish advertised or sponsored articles or links, you may consider all articles or links hosted on our site as a commercial article placement. We will not be responsible for any loss you may suffer as a result of any omission or inaccuracy on the website.
Home Finance Pension savers risk short term issues with one in four lacking surplus income

Pension savers risk short term issues with one in four lacking surplus income

by uma


  • There was a clear correlation between pension adequacy and home ownership in the findings from the HL Savings and Resilience barometer with homeowners of all ages more likely to be on track for a modest retirement income than their renting counterparts.
  • However, there are gaps. One in four people on track with their pensions did not have much surplus income and 14% did not have adequate savings.
  • Half of people on track with their pensions didn’t have adequate life cover.
  • HL’s Resilience barometer uses the PLSA’s retirement income standards for a moderate retirement income. This is approximately £20,800 for a single person and £30,600 For a couple.

Helen Morrissey, senior pensions and retirement analyst at Hargreaves Lansdown:

“Auto-enrolment has done a great job in getting more people contributing to a pension and there are signs the long-term savings habit is sticking with a strong correlation between pension adequacy and home ownership.  For instance, 56.4% of Gen Z homeowners were on track for a moderate retirement income in retirement compared to just 15% of renters of the same generation.

However, it’s not an altogether rosy picture as there are signs that while long-term issues such as the pension and home are being prioritised it may be at the cost of shorter-term finances.

One in four people on track for a moderate retirement income did not have adequate surplus income today. This means their day-to-day finances could be put under pressure by an unexpected large bill. They could also struggle to meet the rising costs of bills and food that we are seeing as inflation surges.

In addition, increased use of variable rate debt means this group have stretched themselves more than those who aren’t on track for a moderate retirement income.

While it is important to prepare your finances for the long term it is also vital not to overstretch yourself financially day-to-day. Building a buffer of three to six months essential expenditure in savings can really help people deal with the unexpected and build financial resilience.”

About the HL Savings and Resilience Barometer

In partnership with Oxford Economics the HL Savings and Resilience Barometer measures the financial resilience of the nation every six months, to see whether we are getting stronger or facing bigger challenges.

The Barometer is unique because instead of looking at specific aspects of our finances in isolation, it draws together 17 data points from a number of official data sets, across these five pillars to provide a holistic measure of the state of the nation’s personal finances.

It is structured around the five pillars of financial behaviour that we consider fundamental for households to balance current and future demands, while guarding against risks. These are: controlling your debts, protecting your family, saving for a rainy day, planning for later life and investing to make more of your money.

The aim of our work in this area is to help to promote awareness and understanding, inform the debate, and ultimately help improve the decisions individuals and policymakers make to improve financial resilience.