A report by AXA Avenue has predicted troubles ahead for those planning to live on a state pension. The report is based upon a unique experiment in which 26 households were challenged to live for a week on a state pension.
According to the experiment's results, tomorrowâ€™s pensioners will be able to live on the state pension for three days rather than a week.
The week long experiment revealed that single women had overspent their budget by 200% and lasted for two and a half days, whilst men performed slightly better overspending by 79% and lasting a little over three days.
According to a statement by AXA, â€œHaving started the experiment on Thursday, the households had used their entire weekly pension allowance by the time they sat down for Sunday lunch.â€
The experiment showed that an average of 28% of spending by households was on drink, tobacco, papers, leisure activities and gambling. Of all the households, only one was able to last seven days. That household had £4.36 remaining at the end of the week.
Participants in the experiment, named â€œLiving on a State Pensionâ€, were expecting to have a retirement of 20 to thirty years, a time they would fill with the leisure activities they could not do whilst in full time employment.
The results of the experiment however cast doubt on whether such expectations of a leisurely retirement, whilst relying solely on a state pension, could be fulfilled.
Colin Nelson of AXA said in a statement: â€œThe results from our â€˜Living on a State Pensionâ€™ experiment highlight some worrying trends. The fact that we struggle to survive on this small amount is not surprising in itself but it is peoplesâ€™ attitudes towards funding their retirement that concerns us most. The experiment has acted as a wake up call for those who took part; now we want to communicate that to the rest of the nation.â€