We use cookies to allow us and selected partners to improve your experience and our advertising. By continuing to browse you consent to our use of cookies. You can understand more and change your cookies preferences here.

Retirement earnings fall: where do pensioners earn the most?

Find out which region pensioners earn the most

Pension earnings have fallen dramatically over the last decade, according to new data from the Department for Work and Pensions (DWP).

The figures show that the current median weekly income for single pensioners is £285, down from £312 in the 2012-13 tax year.

Income earned by retired workers is made up of several sources including the state pension, workplace pensions, personal pensions and income from savings and investments.

Here, we take a look at which regions retired earners earn the most and how you can boost your private pension and state pension income too.


Where do pensioners earn the most?

Single pensioners living in Southern regions of England were found to earn the most retirement income, according to the DWP.

Retired workers living in the South East of England are the highest earners in the UK and the median pensioner income for the area is £305 a week.

The second highest pension earners could be found in the UK’s capital of London where the median pension income is £298 per week.

The South West of England came in as the third highest earning area where pensioners earn £294 a week.

Pension income was found to be lower in the Midlands and North West.

The poorest region for pension income is the West Midlands, where the median weekly income is £269.

Northern Ireland came in a close second with a median income of £271 a week while Yorkshire and Humber and the North West came joint third where pensioners earned £274 each week.

The map below shows the median weekly payment for single pensioners in each region.

Why is pension income falling?

Over the last two decades, rates on savings and investments products have been in steady decline, which has contributed to pensioner income flatlining.

Today, only 60% of pensioners receive income from an investment income; a 13% drop from the 1994-95 tax year when 73% of pensioners received investment income.

In the 1994/95 tax year, 73% of pensioners received income from an investment product compared to only 60% today.

Nathan Long, senior analyst at Hargreaves Lansdown said: ‘There’s yet more evidence that pensioners are being punished as a result of Quantitative Easing, with income from savings and investments on the slide.

‘Pensioners who are holding money as cash could look to the stock market for income, the average UK equity income fund currently offers an income of 4.8%.’

The graph below shows how the proportion of pensioners receiving investment income has changed over time.

Is the state pension increasing?

From 6 April 2019 the state pension, which is a weekly payment you can receive once you hit state pension age, will receive its annual boost.

In order to qualify for the state pension, you have to make National Insurance contributions. If you reached state pension age before April 2016, you’ll be entitled to the basic state pension plus any additional state pension you might have built up.

If you hit state pension age after April 2016, you’ll receive the new single-tier state pension and will need at least 35 years’ worth of contributions to get the full amount.

Both the basic state pension and single -tier state pension are protected by a mechanism called the ‘triple lock’ guarantee.

This basically means that each year state pension payments will rise by the greater of the following:

  • CPI inflation (announced in September the previous year)
  • Annual earnings growth
  • 2/5%

This year, the state pension will increase by average earning growth, which came in highest at 2.6%.

This means that if you’re entitled to the full new single-tier state pension your weekly payments will increase by £4.25 taking them from £164.35 to £168.60.

Those receiving the basic state pension will get a weekly boost of £3.25; increasing your payments from £125.95 to £129.20.

How can I boost my pension income?

Whether you’re nearing retirement or still have a way to go, we’ve rounded up four ways to help boost your state pension and private pension income.

1) Check your state pension entitlement

Checking your state pension entitlement can help you determine if and how much state pension you’re likely to get when you reach state pension age, and whether you’ll need to top it up. You can get your State Pension forecast from GOV.UK. 

2) Apply for National Insurance credits

If you don’t have a National Insurance record before 6 April 2016, you’ll need at least 35 qualifying years to receive the full amount of new state pension and at least 10 years to get any new state pension at all. National Insurance credits contribute to your National Insurance record when you’re can’t work for a specified reason for example if you’re unemployed, caring for children, ill or disabled or taking an approved training course.

The credits go towards building qualifying years for your state pension and could help boost your final entitlement.

While some credits are applied automatically, others may need to be claimed from HMRC. 

3) Top up your state pension

If there was a period of time when you didn’t pay enough National Insurance contributions to get enough National Insurance credits for a full qualifying year, you may find a gap in your National Insurance record.

Leaving these gaps could result in you missing out on the full state pension. To avoid this happening, you can top up your record by making Voluntary ‘Class 3’ National Insurance Contributions.

The deadline to pay is 5 April each year and you can apply through GOV.UK. 

4) Maximise your employer contributions

Increasing your contributions to a workplace pension or private pension could boost your employer’s contribution to your pension pot too.

The table below shows the minimum employer contributions, but some employers may offer more generous terms and it’s worth checking to see if you could get a boost by increasing your own payments.

For more tips and advice on how to increase your pension income, take a look at our list of 20 ways to boost your state pension in 2019.

This story was updated on 23/4/2019

Back to top
Back to top