Many may struggle in retirement as DWP remind of pension credit

Research from Scottish Widows has claimed some 35% of adults currently aged 22 to 65 risk having "less than the minimum needed" to pay for essentials when they retire.

It predicted many will still be paying rent in retirement and said that pressure on workers had only "intensified" due to inflation and rising interest rates this year.

This warning comes amid fears that many are not saving enough for later life, despite measures such as the introduction of auto-enrolment in workplace pension schemes, Sky News reports.

Alongside this, the Department for Work and Pensions (DWP) is urging all current pensioners to carry out a check and see if they are eligible for Pension Credit, which could give them a boost of up to £3,500 a year.

Around 35 per cent of adults risk having less than the minimum needed to pay for essentials in retirement (Image: PA)

How much are retirees set to get per year?

The research found that the average man is set to receive £19,000 in income per year after they retire, compared to £12,000 for women.

Pete Glancy, head of policy at Scottish Widows, said: "Our new national retirement forecast paints a stark picture - one in three of us are facing the harsh reality of a retirement where we will struggle to make ends meet.

"Last year's retirement report highlighted the impacts of the pandemic, cost of living and wage stagnation. This year the pressure seems to have intensified due to increasing inflation and interest rates continuing to climb."

It estimated that 36% of adults are likely to have a "comfortable" lifestyle, with enough cash to pay for luxuries such as holidays, while the remaining 11% are on track to experience a "moderate" living situation in retirement.

Meanwhile, 18% of adults are on course for a "minimum" lifestyle when they stop working, which will just about cover basics such as bills while leaving them with some money left over.

A DWP spokesperson said: "Automatic enrolment has transformed pension saving with more than 10.8 million workers signed up to a workplace pension and an extra £33bn saved in 2021 compared to 2012.

Around 36% of adults will have a 'comfortable' lifestyle in retirement (Image: PA)

"We are supporting proposals to expand this so millions more save earlier, including young people, women and lower earners, while the free guidance on offer via MoneyHelper and Pension Wise is also helping people make informed choices about their financial futures."

Are you eligible for Pension Credit?

If you are a pensioner already and are potentially struggling to make ends meet there is an opportunity to potentially get a £3,500 a year boost with Pension Credit, which you can check your eligibility for on the Government website here.

It is designed to help people over State Pension age and on a low income with daily living costs, though you do not need to be in receipt of State Pension to receive it.

The scheme tops up a person’s income to a minimum of £201.05 per week for single pensioners and to £306.85 for couples.

To qualify for Pension Credit, your weekly income must be below those amounts.

On average, those entitled to Pension Credit could be £3,500 better off a year, according to the DWP.