State pension needs to double, say hard-up Brits

100 years after the first state pension was claimed, many of today's pensioners and people saving for retirement think the basic state pension would have to double in order to provide a comfortable retirement according to new research, from Friends Provident.

The research found that £832 is the average monthly amount considered enough to live a ‘comfortable retirement' (excluding rent or mortgage payments), £439 more than an individual pensioner currently receives as the basic state pension each month.

Yet in the study more than half (57 per cent) of adults said they plan to solely or partly use the state pension to fund their retirement and a similar amount (56 per cent), would like to see the Government considerably increase the value of the state pension by 2059.

Astoundingly, the research found that people are more willing to compromise on their retirement plans than to start acting now. Currently only one in 10 adults would be prepared to invest a sizeable portion of their income into a pension, preferring to cut back on their day-to-day living costs during retirement (19 per cent), retire five years later (17 per cent) or downsize their property (15 per cent). Just four in 10 (40 per cent) UK adults feel that people claiming their pension now are now better off than those who were able to claim the state pension in 1909.

On the centenary of the first basic state pension payment, 64 per cent of adults say they are currently finding some difficulty in meeting their costs of living. Three quarters (75 per cent) of UK adults feel that the state pension is not sufficient to live on and one in three (36 per cent) feel that they will struggle to make ends meet during their retirement.

When asked to look forward 50 years to 2059, UK adults are pessimistic about the future of pensions with over a quarter (28 per cent) thinking that they will be decidedly more inferior than they are now and 27 per cent thinking that they will be somewhat inadequate.

Pensions in 2059 - Top five changes UK adults want to see

Action from Government to increase value of the state pension

More support from employers with increased contributions into company pension schemes

No set retirement age to prolong working lives

Better pensions for women

A compulsory pension fund started from birth

Martin Palmer, head of corporate pensions marketing at Friends Provident, said: "A lot has changed in 100 years. When the state pension was first paid in 1909, those people who qualified for it would have been delighted at the extra support it gave them in their retirement. Today, even though it is a universal benefit, paid at an earlier age, and worth more in real terms than in 1909, many people feel it is an inadequate benefit, insufficient for their needs.

"Thankfully these days there is much wider access to private pensions which can provide real financial support in retirement. It is therefore very worrying that so many people haven't taken up this option and are relying on the state pension alone to fund their retirement."

Friends Provident has launched an e-learn tool to help people understand money and the importance of effective financial planning for them and their families. For more information on this visit friendsprovident.co.uk/elearn