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Planning for a pension is important as the cost of living increases

By Tom Farley, Wed 21 Sep 2011 - Published in Pensions

Brits over-55 planning to take out their pension may find it harder than they thought to enter retirement.

This is according to research by Aviva, which found that the UK's over-55s have seen their typical income fall to its lowest level since the firm's Real Retirement Report was launched in 2010.

On top of this, 75 per cent of those planning for their twilight years are worried about the rising cost of living, with a quarter of these now having less than £500 in savings.

Clive Bolton, a retirement director at Aviva, said: "The over-55s have seen their finances deteriorate over the last quarter as people struggle to keep up with the rising cost of living on a relatively fixed income."

He added that taking out a private pension or building up a respectable savings pot are simple steps that can help people avoid these problems when they reach retirement age.

Recently, Standard Life revealed that people from the East Midlands contribute the most towards a pension - £172 a month compared to the national average of £137.