Retired household income up 13% since 2008

Tax Comments Off on Retired household income up 13% since 2008

Retired household income up 13% since 2008

Median income for retired households rose by 3.1% between 2014/15 and 2015/16, according to the Office for National Statistics (ONS).

The latest disposable income and inequality statistics show that median income for retired households at the end of 2015/16 was £21,800. This is an increase of 13% (around £2,500) from 2007/08.

The median income for non-retired people decreased by 1.2% (around £300) in the same period.

Steven Cameron, pensions director at Aegon UK, said:

“While the figures suggest there has never been a better time financially to be retired, today’s pensioner households are benefitting from 2 big factors. Firstly, many are receiving an income from generous defined benefit schemes.

“Secondly, pensioner benefits have been largely protected by recent government policy and the triple lock state pension in particular has come into focus for the high cost of providing such a generous uplift.”

Composition of retired household income

The state pension was the second largest source of income for retired households in 2015/16.

The overall proportion of retired household income coming from cash benefits including the state pension has fallen from 64.7% in 1977 to the current level of 45.9%.

There has been a growth in the percentage of retired households receiving income from private pensions, up from 44.5% in 1977 to 78.8% in 2015/16.

Average income received from private pensions in 1977 was £1,600 (18% of gross income). This has increased to £11,000, or 43.8% of gross income, in 2015/16.

Talk to our team about your retirement income today. Contact Sue Stephens.