State pension not enough, expert warns

Fri, 17 Nov 2006

The state pension will not be sufficient to allow a comfortable retirement despite recent government reforms, claims an expert.

Individuals reliant on the state pension after the link to earnings is restored will have an income of £84.25 per week, states David Kuo, head of personal finance at The Motley Fool.

This is not adequate to secure a "comfortable retirement", he warns.

Mr Kuo asserts that those reaching retirement must carefully analyse their circumstances and calculate how much they need to save in order to provide a suitable pension income.

"It is hard to envisage that anyone can live in comfort on just £84 a week," he remarks.

The expert adds that three key questions must be considered by individuals approaching retirement age.

"How much money will we need to retire on comfortably? How big does our pension pot need to be to provide this comfortable income? And how do we achieve this?"

Earlier this week, JPMorgan INVEST claimed that 14 per cent of UK adults were saving enough to secure a comfortable retirement.


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