UK pensions ‘among worst in developed world’

British pensions are some of the worst in the developed world, according to a UBS report which compares the retirement prospects for 50-year-old women in major cities worldwide.

Taking into account each country’s basic state pension, plus the compulsory pension employers must set aside, the investment bank calculated the proportion of an average salary someone could expect to receive once they retire.

It found a woman in London could expect just 41% of her current income, on a par with Hong Kong and just above the lowest ranked city, Taipei. A woman in Singapore, which ranked first, would get 73% of her existing salary.

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The report says the figures show “the [UK] system relies heavily on private provisions [and are] a good example of how starting late in life will require more sacrifice to catch up”.

Research published by Age UK last week found nearly eight million people in Britain aged 40 to 64 will not be able to retire when they hit state pension age, which is currently 65.

Over one third of those questioned expected to still be working the same hours in the same job as they do now once they reach their late 60s, despite being able to start withdrawing their state pension before that.

The current state pension age is under review and is set to rise to 67 in the next decade, with plans to increase it to 68 by 2039.

The best cities for pensions:

Singapore 73%Sydney 72%Paris 69%Milan 67%New York 55%Tokyo 55%Munich 50%Zurich 48%Toronto 42%London 41%Hong Kong 41%Taipei 32%