State pension: UK vs the world – how does your sum compare?

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State pension rise is 'woefully insufficient' says expert

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The state pension is a bedrock of retirement, providing weekly financial support. Individuals will put forward National Insurance contributions or credits throughout their lifetime and receive their sum once they reach the age of eligibility.

But how does the state pension in Britain compare to that of other countries across the world? 

Pension systems will be different in individual countries, it is worth noting.

In some places, pensions are neither contributory nor are they taxable.

However, in others places, the pension is an income on which tax is payable.

To make the study fair, the organisation Picodi looked at the net amount: what a person actually receives on their account or in cash.

Of the 44 countries considered in this analysis, the UK ranked ninth on the list for the average state pension monthly rate.

In Euros, it was found the state pension was worth €1,114 or £937.67 monthly.

The study looked at the latest data collated from the Department for Work and Pensions (DWP).

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It stated 8.4million people receive pensions across the country.

Due to the way the system works in the UK, many will be receiving different amounts due to their National Insurance contributions.

Looking at the countries considered in the study, Norwegians were found to receive the highest pension at €1,797 (£1,521) per month.

Following closely behind were Switzerland at €1,704 (£1,434) and the United States at €1,482 (£1,247).

However, it is also worth considering the opposite end of the spectrum and its impacts.

Retirees in Albania, Moldova and the Ukraine were found to receive low amounts.

The study recorded these as €128 (£107) for both Albania and Moldova, and €110 (£92) for Ukraine.

The UK’s ninth place ranking means it falls behind other European countries such as Spain, Ireland, France, Finland and Austria.

The study also analysed the regular food shop for pensioners, creating a conventional basket.

The aim was to analyse the cost of the essentials in relation to the average pension.

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Although the list was limited it included 12 loaves of bread at £11.76, three kilograms of rice at £3.90, 20 eggs at £3.25 and 12 litres of milk at £11.04.

The basket also included items such as cheese, poultry, fish, fruits and vegetables, and yoghurt. 

It was found the value of the basket of basic food products in April 2022 is £134.39.

As a result, staple food – only that needed for basic survival – was found to be the equivalent of 14.4 percent of the average British pension.

Regarding food expenses, the United Kingdom ranked fourth out of 44 when related to the average pension in each country.

This meant the UK is ahead of other countries such as Australia, Ireland and the United States. 

A DWP spokesperson told “As this research shows, the UK state pension continues to provide a strong foundation for retirement planning and financial security in older age. Alongside this, Automatic Enrolment has succeeded in transforming private pension saving. A record number of Brits are now saving for retirement – more than 10 million workers have been enrolled into a workplace pension since its introduction, with an additional £28 billion saved in 2020 compared to 2012.”

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