Britain has more than a million pensioner millionaires, according to new official data.
Growing pension, property and investment values have fuelled the growth in pensioner millionaires, says the Office of National Statistics (ONS).
But the gap between the richest and poorest is vast – with another million pensioner households having a net worth of less than £40,000.
The figures come from the latest ONS Wealth & Assets Survey for 2010-2012.
Analysis of the statistics show that the number of millionaire pensioners has soared by almost 70% since a similar survey was carried out in 2008.
In real terms, one in 10 households aged over 65 years old are millionaires – and increase of nearly half over the earlier survey, when 7% achieved the same financial status.
The report also found that households of the over 65 year olds are more likely to be millionaires than any other age group.
The UK average across all age groups is 9%, while the over 65s average is 11%.
Financial firm Prudential looked at the figures and revealed the improving wealth of pensioners is due to:
- The increasing value of pension funds – up from a median £60,000 in 2008 to £82,300
- Putting away savings and investing – 19% of over 65 households have savings and investments worth at least £100,000, compared to 15% in 2008
- Improving home values – pensioner couples have a home worth an average £210,000, up £10,000 (5%) from 2008, while single pensioners have homes valued at an average £170,000, compared to £165,000 in 2008
Not all pensioner households are so well off. The statistics also disclose that 12% have savings of less than £500.
Savings increase faster than property prices
Prudential’s Vince Smith-Hughes said: “The statistics shine light on some interesting facts. For instance, the value of pensions, savings and investments has gone up faster than property values in recent years.”
The firm also warns that retiring with some wealth is no reason to stop financial planning.
“Accruing wealth during their working life shows many pensioner millionaires have made sensible financial decisions,” said Smith-Hughes. “However, it doesn’t end there. Investing the money wisely after retirement, along with tax and estate planning are also important steps as well.”
The survey also shows retirement savers with defined benefit pensions not yet in drawdown had a median fund value of almost £40,000, while those with defined contribution pensions have £15,000.