Experiment Throws Doubt on Life on a State Pension
A report by AXA Avenue has predicted troubles ahead for those planning to live on a state pension. The report is based upon a unique experiment in which 26 households were challenged to live for a week on a state pension.
According to the experiment's results, tomorrow’s pensioners will be able to live on the state pension for three days rather than a week.
The week long experiment revealed that single women had overspent their budget by 200% and lasted for two and a half days, whilst men performed slightly better overspending by 79% and lasting a little over three days.
According to a statement by AXA, “Having started the experiment on Thursday, the households had used their entire weekly pension allowance by the time they sat down for Sunday lunch.”
The experiment showed that an average of 28% of spending by households was on drink, tobacco, papers, leisure activities and gambling. Of all the households, only one was able to last seven days. That household had £4.36 remaining at the end of the week.
Participants in the experiment, named “Living on a State Pension”, were expecting to have a retirement of 20 to thirty years, a time they would fill with the leisure activities they could not do whilst in full time employment.
The results of the experiment however cast doubt on whether such expectations of a leisurely retirement, whilst relying solely on a state pension, could be fulfilled.
Colin Nelson of AXA said in a statement: “The results from our ‘Living on a State Pension’ experiment highlight some worrying trends. The fact that we struggle to survive on this small amount is not surprising in itself but it is peoples’ attitudes towards funding their retirement that concerns us most. The experiment has acted as a wake up call for those who took part; now we want to communicate that to the rest of the nation.”
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