New analysis by Standard Life has calculated the proportion of retirement income that will come from the State Pension for people with different sized pension pots, highlighting the importance of different income streams in later life and how the payment from the Department for Work and Pensions (DWP) can play a significant role.
Someone reaching retirement aged 66 with a pot of £50,000 could buy an annuity that guarantees a yearly income of £3,600. As the full State Pension currently pays £185.15 per week or £9,627,80 per year - this would mean that almost three-quarters (73%) of their total income in retirement will come from the State Pension. A £132.5k pot would lead to approximately 50 per cent of retirement income coming from the State Pension.
Meanwhile, someone with a pot of £200,000 would receive a yearly income of £14,650, meaning 40 per cent of their total pension income would come from the State Pension.
