We’re richer than ever thanks to our property and pensions

BRITONS are wealthier than ever with a rise in household net worth fuelled by soaring property prices and private pension schemes, according to figures released yesterday.

Another 800,000 households became millionaires as total net household wealth – including property, savings, shares, pensions and possessions – increased 15 per cent to £12.8trillion in the twoyear period ending in June 2016, according to the Office for National Statistics.

The net wealth of the average household’s was £259,400, with 3.6 million households – 14 per cent of the population – having assets of more than £1million, up from 2.7 million households in 2014.

The number of households with a net worth of under £20,000 was also 3.6 million.

The top 10 per cent of households owned almost half of all total wealth.

The fastest increase in wealth came from private pensions, which grew by a fifth to reach £5.3trillion.

Total pension assets were boosted by “auto-enrollment”, increasing the number of people saving to a private pot from 44 to 49 per cent. Mark Abley, of The Pension Review Service, said: “The fact that pensions are one of the major drivers of household wealth reflects the fact workers are waking up to the reality that the state pension will not be enough to maintain a similar lifestyle to being in work.

“Pensions are the most tax efficient savings plan as the Government contributes to every pound you pay. With savings rates still at rock bottom it makes sense to top up your pension.”

Public sector workers boasted the most pension wealth, with an average fund now valued at £80,000.

Malcolm McLean, senior consultant at Barnett Waddingham, said: “There’s a lot of good news in these figures.

“Total private pension wealth has increased and many more people of working age are contributing to a private pension arrangement than previously.”

He did sound one note of caution over pension wealth, insisting “the gap between the public and private sectors continues to grow and should be addressed”.

There was a striking difference between regions, with the biggest wealth gains in London amid soaring property prices. The North-east was the poorest in terms of total wealth. It held £370billion, compared with £2.5trillion in the South-east.

David Burrowes, chairman of the Equity Release Council, said: “These figures reaffirm the potential of housing wealth. Property is often a household’s largest asset.”