A recent analysis by retirement specialist Just Group has uncovered that approximately 740,000 single retirees and 500,000 retired two-adult households, totaling over 1.2 million individuals, heavily rely on the state pension as their primary source of income in retirement. These households receive at least three-quarters of their total income from the state pension or similar pension-related state benefits, according to data from the Office for National Statistics (ONS).
The state pension falls short of the amount needed for a comfortable retirement lifestyle. The Retirement Living Standards recommended by Pension UK suggest that a single pensioner requires an annual income of about £13,400 to meet a “minimum” standard of living.
The current full state pension amounts to £230.25 per week, resulting in a shortfall of £1,427 annually to reach the minimum standard of living in retirement. David Cooper, director at Just Group, highlighted the substantial number of pensioners relying mainly on the state pension and emphasized the importance of bridging the income gap to achieve a decent standard of living in retirement.
To help bridge this gap, retirees are advised to explore potential eligibility for additional benefits that could significantly enhance their living standards during retirement. The state pension increases annually in line with the triple lock system, ensuring adjustments based on earnings growth, inflation, or a minimum of 2.5%.
Starting April 2026, the state pension will rise by 4.8%, with the new full state pension increasing to £241.30 per week and the basic state pension to £184.90 per week. Individuals currently retiring will need 35 years of National Insurance contributions to qualify for the full state pension.