Wednesday, October 12, 2011

UK: £200bn black hole puts more pensions at risk

The country’s biggest private sector pension funds are £200billion in the red, a report warned yesterday. In just four weeks, the deficit has grown by £80billion, fuelled by the stock market plunge and collapsing returns on government bonds. Experts warn the alarming figures could prompt employers to close pension schemes or make them less beneficial to staff.

Money Mail, and This is Money online, highlights today the desperate plight of workers on the verge of retirement. The financial turmoil since July has wiped up to 20 per cent off their pension payouts. On July 7, a worker with a £100,000 pension pot could have bought an annuity – an income for life – of £6,731 a year. Today, the figure stands at £5,310 a year, a drop of £1,421, or 21 per cent.

No comments:

Post a Comment