Their report states that:
- Retirees who have been divorced expect a £13,800 annual retirement income compared with £16,400 for those who have never had a marriage breakdown
- Around one in five divorced people do not have private pensions
- 22 per cent of previously divorced people retiring in 2013 are doing so with debts
Prudential's Class of 2013 research, the latest of its annual studies into the financial plans and expectations of people planning to retire in the next year, has for the first time looked at the impact of divorce on retirement finances. The results have highlighted stark differences in expected retirement income between those who have been divorced and those who have not.
The research shows that 40 per cent of those planning to retire in 2013 have been divorced, and in general they are less likely to have private pensions, more likely to retire with debts, and less likely to believe they are financially well prepared for retirement. They are also less likely to expect to be able to leave an inheritance.
Nearly one in five (18 per cent) of previously divorced 2013 retirees have no private pension savings compared with 14 per cent of those who have never been divorced. Prudential also found that 22 per cent of those who have been divorced are retiring with debts compared with 16 per cent who have not been divorced, while just 45 per cent expect to leave an inheritance compared with 52 per cent who have not been divorced.
Only one in three (33 per cent) of those who have been divorced believe they have saved enough for a comfortable retirement, while just 42 per cent of those who have divorced say they are financially well-prepared for retirement.
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