Savers in the South East have the greatest average pension wealth in the UK

Ffion White

by , PR Manager

19 June 2023 /  

19
June 2023

People at breakfast.

New analysis of more than 198,000 PensionBee customers, reveals a substantial difference in average pension pot sizes, depending on a saver’s location.

Average pot size by regions

Research from leading online pension provider, PensionBee, found that, on average, savers in the UK have a pot size of £17,379. Residents in the South East have accumulated the most pension wealth, with an average pot size of £22,673, significantly more (26% greater) than the national average.

Savers in Greater London also exceed the national average by 15%, with a typical Londoner’s pension pot standing at £20,151. Despite London having the highest average weekly income in the UK (1), the lower average pot size may be attributed to greater housing costs compared to the South East (2).

In contrast, savers in Northern Ireland have saved the least towards their retirement, with a typical pot size of £12,011, 37% less than the UK average.

Average pot size by region by age

As a saver ages, their average pension pot size increases. Across all age groups, up to the age of 50, those in Greater London typically boast the biggest pension pots, with Londoners under 30 having 35% more saved in their pensions than the national average.

However, as a saver nears retirement (aged 50+), residents in the South East overtake Londoners with their pension wealth, recording an average pot size of £45,265, although it’s worth noting that the difference between the two regions is minimal (£666). In contrast, those nearing retirement in Wales have the least saved towards their retirement, with typically only £28,926 in their pension pots, over £16,000 less than those in the South East.

Expected pension pot in retirement

PensionBee also calculated the expected retirement pot of each age group, based on certain assumptions. This analysis found that those nearest to retirement, who have the most pressing financial needs, could potentially retire on significantly smaller pensions than their younger counterparts.

On average, savers aged 50 and over look set to retire on the smallest personal pensions of £78,523 by the time they reach 66. Meanwhile, those under the age of 30 are expected to amass pots worth £180,055, on average, by the time they reach the age of 66.

Becky O’Connor, Director of Public Affairs at PensionBee, commented: “Regional pension inequality is rife. Retirement outcomes are a mixed bag across the country, mainly as a result of different income levels throughout working life.

People in some parts of the country will therefore be more dependent on the State Pension for retirement than people in other parts of the country.

For younger people, the forecast based on their current pot size, is that their income would give them a basic to moderate living standard according to the Pensions and Lifetime Savings Association’s guidelines.”

Notes to Editors

The findings relate to defined contribution pensions and some older savers fortunately continue to have access to defined benefit company pensions.

Further regional breakdowns are available on request.

Appendix

Table 1: Average pension pot size by region

Region Average pot size % Difference compared to the UK average
Northern Ireland £12,011 -37%
North West £13,270 -27%
North East £14,005 -22%
East Midlands £15,570 -11%
West Midlands £15,431 -12%
South West £16,784 -3%
South East £22,673 26%
Wales £13,563 -25%
Scotland £15,194 -13%
Greater London £20,151 15%
Average £17,379 N/A

Source: PensionBee, May 2023. Total sample size of the UK Pension Landscape is 198,430 customers as at March 2023.

Table 2: Average pension pot size by region age under 30

Region Average pot size % difference to UK average
Northern Ireland £2,301 -26%
North West £2,453 -20%
North East £2,603 -14%
East Midlands £2,572 -15%
West Midlands £2,548 -16%
South West £2,607 -14%
South East £3,243 8%
Wales £2,270 -28%
Scotland £2,789 -7%
Greater London £4,265 35%
Average £3,002 N/A

Source: PensionBee, May 2023. Total sample size of the UK Pension Landscape is 198,430 customers as at March 2023.

Table 3: Average pension pot size by region age 30-39

Region Average pot size % difference to UK average
Northern Ireland £5,958 -43%
North West £6,866 -28%
North East £7,338 -21%
East Midlands £7,194 -23%
West Midlands £6,720 -30%
South West £7,914 -14%
South East £10,330 13%
Wales £7,040 -25%
Scotland £7,994 -13%
Greater London £12,662 33%
Average £9,078 N/A

Source: PensionBee, May 2023. Total sample size of the UK Pension Landscape is 198,430 customers as at March 2023.

Table 4: Average pension pot size by region age 40-49

Region Average pot size % difference to UK average
Northern Ireland £15,749 -33%
North West £15,590 -34%
North East £16,110 -30%
East Midlands £18,091 -19%
West Midlands £18,038 -19%
South West £19,726 -10%
South East £27,553 23%
Wales £15,984 -31%
Scotland £18,651 -16%
Greater London £30,109 32%
Average £21,886 N/A

Source: PensionBee, May 2023. Total sample size of the UK Pension Landscape is 198,430 customers as at March 2023.

Table 5: Average pension pot size by region age 50+

Region Average pot size % difference to UK average
Northern Ireland £32,796 -12%
North West £30,722 -19%
North East £31,047 -18%
East Midlands £33,768 -9%
West Midlands £34,044 -9%
South West £35,268 -5%
South East £45,265 20%
Wales £28,926 -25%
Scotland £32,744 -12%
Greater London £44,599 18%
Average £37,089 N/A

Source: PensionBee, May 2023. Total sample size of the UK Pension Landscape is 198,430 customers as at March 2023.

Table 6: Expected pension pot in retirement

Age Average pension pot by age 66
Under 30 £180,055
30-39 £154,371
40-49 £155,344
50+ £78,523

Source: PensionBee, May 2023. Total sample size of the UK Pension Landscape is 198,430 customers as at March 2023. We have assumed the pension grows at an annual rate of 5% and that, based on our default plan, Tailored, annual charges are 0.7%. Average monthly contributions are based on the minimum required contribution of 8% of qualifying earnings for Auto-Enrolment. Average salaries are taken from HMRC’s national statistics on the distribution of income, and it is assumed that individuals will receive a 2% salary increase per year. Inflation reduces the rate of return. All calculations are based on the average age for the entire group, and it is assumed that the retirement age is 66.

Footnotes

  1. Statista
  2. Property Investments UK

Be pension confident!

Combine your old pension pots into one new online plan. It takes just 5 minutes to sign up.

Get started

Mobile PensionBee analytics chart
Mobile PensionBee analytics chart
Apple Store logo Google Store logo

Have a question?Call our UK team020 3457 8444

Monday-Friday: 9:30am-5pm