Growth in pensioner income surpasses working households

Pensioner households have on average £20 more a week than working households, according to research by Resolution Foundation.

In 2001, pensioner incomes were around £70 a week lower than working age incomes. However, income growth of individuals who turned 65 in 2001 was 7% higher in 2014.

The rise in average pensioner income comes from people retiring in recent years.

Factors driving the rise in pensioner income:

  • Higher levels of pensioners in some kind of employment – almost a fifth of pensioners
  • Remain in some kind of paid employment after reaching retirement age
  • High levels of home ownership – 73% of pensioners currently own their home
  • Generous private pension pots – occupational pension pots are the biggest source of rising pensioner income

The value of pensioner benefits income has increased by 8% since 2001, accounting for a quarter of income growth.

Adam Corlett, economic analyst at the Resolution Foundation, said:

“Of course, not all pensioners can draw on these income sources, which is why the state pension will always be the main income for many pensioners.

“The big challenge we face as a society is to ensure that the record incomes that a new generation of pensioners are enjoying are not a one-off gift, and can endure for future generations too.”

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