'Under-saving' for retirement alert

The proportion of people who are saving enough for their retirement has fallen to its lowest levels in at least nine years, a report has warned.

Less than half (45%) of those surveyed by Scottish Widows were found to be making adequate provision, marking a new low since research started in 2005.

A retirement savings gender gap is also on the increase, with 40% of women putting enough by compared with 49% of men.

The widened gap has come from a drop in the proportion of women who were preparing adequately, from 42% last year.

One-fifth of men and women combined were saving nothing at all for their old age and more than a third were "under-saving".

People were seen as preparing adequately if they were saving at least 12% of their income or expecting their main retirement pot to come from a "gold plated" defined benefit (DB) pension which offers a guaranteed level of income such as a final salary pension.

The typical level of income people felt they would need in retirement was £25,200. But based on what pension savers were putting away, the report estimated they were more likely to end up living on around £11,400 a year, including their private and state pension.

The proportion of people saving enough for their pension has generally been on a downward slide since a peak of 54% of people who were saving enough in 2009, according to the annual report.

Ian Naismith, a pensions expert at Scottish Widows, said: "People are now less prepared for retirement than at the height of the downturn a few years ago, yet expectations for income in retirement are still increasing. As a nation we must either prioritise saving for the future and prepare accordingly, or seriously adjust our outlook for old age."

The research was based on people earning over £10,000 a year and aged 30 and over. More than 5,000 people took part in the study between February and March across the UK.

The famous faces of bankruptcy

The famous faces of bankruptcy