People 'face working into their 80s before they can afford to retire'
People in parts of the UK may have to work into their 80s to maintain their current living standards in retirement, according to a new report.
An average earner who starts saving for a pension at the age of 22 and makes the minimum statutory contributions would need to work until the age of 77 to get a "gold standard" pension, research from Royal London found.
A "gold standard" pension is defined as a total pension - including state pension - equating to two-thirds of that person's final income before they retired, and it would include protection against inflation as well as provision for a surviving spouse.
Even to get a "silver standard" pension - around half of last pre-retirement income, with inflation protection and provision for a spouse - the same worker would need to work until the age of 71, the report found.
But with wages varying across the country, those in high-income areas need to build up much more private pension to maintain their current living standards than people in lower wage areas.
In several areas of London people may need to work until their 80th birthday to achieve their current living standards in retirement, the report found.
In Westminster, someone may need to work until the age of 81 to reach the gold standard - while in Boston, Lincolnshire, they would need to work until the age of around 73 - a gap of eight years.
In Scotland, a worker would be aged 77 by the time they achieved their retirement gold standard, while in Wales and Northern Ireland they would be 76.
The average ages at which people can expect to achieve their gold standard pension age, followed by their silver standard age, by region.
North East - 76, 70
North West - 76, 71
Yorkshire and the Humber - 76, 70
East Midlands - 76, 70
West Midlands - 76, 70
East of England - 76, 70
London - 79, 73
South East - 78, 72
South West - 76, 71
Wales - 76, 70
Scotland - 77, 71
Northern Ireland - 76, 71
Meanwhile a independent review for the Labour Party concluded people should double the amount they are saving into their occupational pension schemes.
The Independent Review of Retirement Income suggests the target for savings should be 15% of salary.
It comes after Rebecca Taylor, director at the Chartered Institute for Securities and Investment, told the Financial Times last month that 25-year-olds would need to save £800 a month on average for 40 years to secure a £30,000 per year income in retirement.
At the moment the average worker puts just 4.7% of pay into a pension - with most employers making a further contribution of less than 4%.
The government has confirmed that there will be a review of the state pension age.
It will consider what the state retirement age should be from April 2028, with the results set to be published next May.
Currently the state pension age is set to be 67 for both men and women by 2028.