Cost of a State Pension

May 27th, 2016

The State pension is worth a staggeringly large amount of money, says the Mail. To buy a lifetime income equal to the new flat-rate State pension in the open market would cost between £240,000 and £260,000.

The cost is so high because of rising life expectancy, low interest rates and the fact that the state pension is inflation-proof. Research shows the average private pension pot for people in work is about £49,000, so that if – as many people do – you want an income of double the state pension in retirement, you will need at least £250,000 in your pension fund and may well need to save more to accumulate it.