Savers expect on average to be £97 a week short when retirement savings are compared with the expected outgoings in retirement, according to major research from Friends Life.
The insurer looked at the savings behaviour of 18,000 consumers in England and Scotland. It found that although 58 per cent hold some form of pension, and almost a quarter (23 per cent) are saving as much as they can afford into their pension, overall, the average total value of retirement savings (£312 a week) will not cover expected living and housing costs (£409 a week).
The research presents a regional view of the findings in the form of the UK Retirement Savings map below (click to enlarge), which highlights the disparities in savings attitudes between regions.
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For example, the West Midlands, Scotland and the South East have the highest proportion of people saving the maximum they can afford into their pension. In contrast, in the East Midlands, East of England and South West more than half of people are not contributing to a pension at all.
While people are more inclined to build up a pension in some areas rather than others, there are also differences between regions in their understanding of what they'll need in retirement.
The East of England, Greater London and Scotland are the three regions with the greatest mismatch between retirement income and expected living costs.
In particular, Londoners are second least likely to save for retirement, but also up against the highest living expenses, suggesting they are struggling to make pension provision given the difficulties of meeting current living costs.
Drilling down to city level, the research finds that people in Edinburgh are most focused on their pension saving, while those in Birmingham are up against a particularly large shortfall of £103 a week.
In contrast, residents of Sheffield and Bristol have most closely aligned their pension savings with likely costs of living in retirement.
'Our Retirement Savings Map shows there are worrying areas of financial deficit where a combination of a lack of awareness, lack of planning and soaring living costs mean a future situation of income shortfall,' comments Andy Briggs, group chief executive at Friends Life.
Friends Life highlights a number of steps that pension savers can take to help ensure they can afford the kind of retirement they expect, including considering Isa savings as well as pensions, consolidating pension pots from previous jobs, and finding investments suitable for their risk profile and circumstances.
That might include looking at investment trusts as an alternative to unit trusts as a long-term pension investment. New research from Canaccord Genuity highlights the fact that investment trusts have performed better than unit trusts in 12 out of 15 sectors over ten years, though the short-term ride may be bumpier.