The global pensions crisis has been laid bare by new analysis that shows people retiring today can expect half the income of those who became pensioners at the start of the millennium.
The stark findings by the Organisation for Economic Co-operation and Development (OECD) will be presented in a report this week that highlights the impact of ultra-low interest rates on global retirement incomes. It shows that a person buying an annuity today who saved 10pc of their wages into a pension for 40 years can expect just over half the earnings of someone who saved the same amount but retired 15 years ago...The think-tank's analysis of defined contribution schemes, where the value of pension pots can rise or fall depending on how investments perform, highlights the challenge faced by many pension providers in the current low growth and low inflation environment
Pension funds invest around 40pc of their assets in fixed income securities, according to the OECD, including lower yielding government bonds.
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