So who’s got the £11m pension pot?
BRITAIN’S biggest pension pot stands at an incredible £11 million – and could provide an annual retirement income of £540,000.
More than 46,000 of the wealthiest pension savers are sitting on pots worth more than £3 million, according to official data obtained through a Freedom of Information request.
An estimated 929,000 have saved up between £1 million and £2 million in pension wealth, with 128,000 sitting on £2 million to £3 million.
Those in the top 10 per cent of savers have more than £374,500 in pension wealth, according to the Office for National Statistics.
Rob Burgeman, of wealth manager RBC Brewin Dolphin, who put in the request, said: ‘It’s impossible to know how this person got to an £11 million pension, but . . . I would guess they were in a defined benefit scheme.’
Senior executives belonging to a ‘defined benefit’ pension scheme have in the past been able to amass pots worth millions of pounds.
These gold-plated pensions pay a guaranteed income in retirement that rises each year from the date you retire. They are no longer widely used as they were deemed too costly.
Disgraced former Royal Bank of Scotland boss Fred Goodwin was found to be enjoying a £17 million pension after being forced to quit the company in 2008, Daily Mail analysis previously found. Another way of amassing an £11 million pension would be for an entrepreneur who founded a business to squirrel their earnings into a ‘self-invested personal pension’ in their own firm’s shares, Mr Burgeman said.
It costs £37,300 a year for a single pensioner to lead a ‘comfortable’ life, according to the Pension and Lifetime Savings Association.
Someone retiring this year would need a pot worth £630,000 to be able to buy this level of guaranteed income as an annuity.
An 18-year-old entering the workforce today with a modern defined contribution pension would have to invest £49,260 into their pot every year – £4,105 a month – including tax relief to accumulate an £11 million pot by the age of 68, according to Mr Burgeman.