Consumer champion Martin Lewis has sounded a stark warning about pensions, saying that it is “important to know when you’re likely to die” in order to work out how much you need to save for retirement. Some people choose to retire early at 55, as generally speaking this is the age when people can access a private pension pot. But with an average life expectancy of 79 for males and 83 for females in the UK, its means that some people could be retired for nearly 30 years.The state pension age is currently 66 for both men and women but many have to top this up with additional funds, usually in the form of a a workplace pension. Mr Lewis, founder of Money Saving Expert, said it is therefore important to know “when you’re likely to die” so that savers can work out how much they need to squirrel away for retirement. It comes as The Institute for Fiscal Studies warns that nine in 10 workers were saving less than needed for a decent standard of living in retirement. The think tank said that workers in their thirties and forties are heading for an “uncomfortable retirement”. It published a report on Thursday (April 20), which said: “We need a major review of pension provision now in order to give us a chance of avoiding a future that looks worse than the present.” Writing in the Money Saving Expert newsletter, Mr Lewis said: “It’s important to know when you’re likely to die. You can currently take your private pension money at age 55 (rising to 57). Yet one big question is how long you’ll need it to last. Spend it all too soon, and you’ll have a poor retirement. Be overly cautious, especially when you first retire, and you’ll have a worse lifestyle at the time when you can most enjoy it. “Don’t underestimate your longevity - your health, genetics all affect it, but your current age is the single most important factor. The Govt has a basic tool, the life expectancy calculator, as a start point.”
