Cardiff is the cheapest major city in the UK in which to retire, research by a retirement income specialist has discovered.
Analysis of the cost of living and average life expectancy has shown that someone retiring this year would need an annual household income of £25,916 in Cardiff for the duration of their retirement.
The same person would require an additional £8,939 a year if they lived in London, the most expensive city for pensioners.
The main reason for this difference is the fact that the average cost of living in London is 18.49% higher than for the country as a whole, whereas Wales is 11.53% below.
Of the major cities in the UK, Hull and Bradford were the next cheapest. Southampton and Belfast were the next most expensive after London.
The research also discovered that retirement income levels are falling because people are making smaller pension contributions throughout their working lives, are living longer and regulatory changes have hit pension schemes hard during recent years. This is one of the reasons why some people consider investing in property rather than a conventional pension scheme.
Aston Goodey, sales and marketing director, MGM Advantage explains in more detail:
“Retirement should consist of some of the happiest days of your life, but for many, financial constraints can lead to stress and frustration because they can’t afford to do some of the things they want to do.
“We estimate that in the next five to ten years, £135 billion of pension funds will mature and those people who own this need to make sure that they maximise its potential. This includes shopping around for the best annuity for them as this could increase their income by over 30%2. They should also consider an asset backed annuity, which gives people the potential to receive a greater income than through a conventional annuity.”