Standard Life Warns Public to Inflation Proof Retirement Incomes

LONDON, June 16, 2011 -

Standard Life is warning anyone thinking about retirement to
consider the effects of inflation eroding their income.  New
data released today by the savings and investments specialist shows
that many people could see their retirement income swallowed up by
the basic costs of living within seven years, as the effect of
inflation impacts their spending power.

Using Office for National Statistics data and official
Government inflation figures, Standard Life has calculated that
someone with a href="www.standardlife.co.uk/1/site/uk/pensions/products/ampp">
personal pension pot of £80,000, buying a level annuity, will
spend their entire monthly income (from private and state pensions)
on basic living costs like food and fuel within just 7 years of
retirement*.

John Lawson, Head of Pensions Policy at Standard Life said: “The
cost of living is rising fast for most people in the UK, but this
can be particularly acute for pensioners.  Their spending
habits are driven by commodities such as food and fuel bills and
these inflation rates are much higher than the overall UK inflation
rate**.

 ”People need to consider how to protect their buying power
in retirement from the ravages of inflation over a long period of
time, which could be 30 years or more.  If pensioner inflation
remains at around 6% a year, people with a fixed income could lose
almost half of their spending power within a ten year period.

“There are many options to consider at retirement which could
minimise the impact of inflation on your income, so seeking
professional financial advice is vital.”

For further information on inflation proofing retirement income,
and the choices available, interested parties can visit
www.standardlife.co.uk/retirement_solutions/search.html.

Notes to Editors:

*Couple, male aged 65 and female aged 62, with a £80,000 pension
fund who have purchased an annuity

** For example, see Age UK, ’silver RPI’,
www.ageuk.org.uk/latest-press/archive/silver-rpi-impact-of-inflation-for-those-in-later-life/.

About Standard Life:

Standard Life is a leading long term savings and investments
company headquartered in Edinburgh and operating internationally.
Established in 1825, Standard Life provides ISAs, life assurance,
annuities, href="www.standardlife.co.uk/1/site/uk/investing/products/investment-funds">
mutual funds, investment bonds, tax efficiencies, href="www.standardlife.co.uk/1/site/uk/help/financial-calculators-and-tools/pension-planner">
pension planning advice, and investment management to over 6.5
million customers worldwide.

PR Contact:
Paul Keeble
Senior Media Affairs Manager
Standard Life plc
Level 34
30 St Mary Axe
London
EC3A 8EP
+44(0)20-7872-4481
href="www.standardlife.com">www.standardlife.com

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