Pension incomes at five-year low

This year’s retirees will have the lowest pension incomes since 2008, according to research by insurer Prudential.

People retiring in 2012 will have an average income of £15,500 per year according to Prudential's projected figures, compared with last year's average of £16,500 and 2008's £18,600,

It said ongoing market turmoil and the banking crisis were among the main reasons for the decline.

The research was based on a survey conducted in December 2011 of 9,614 UK non-retired adults aged 45 and over including 1,003 retiring in 2012.

Prudential estimates that one in five retirees this year will have an income of less than £10,000 per year for the remainder of their lives.

Londoners are likely to have higher incomes of an average of £17,900 whilst those in Yorkshire will receive around £12,800.

"The impact of the credit crunch, banking crisis, recession, and concerns over the Eurozone, has been reflected in the fact that expected retirement income levels have hit a five-year-low," said Vince Smith-Hughes, head of business development at Prudential.