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&#39Stakeholder will not pay out much more than Mig&#39

Stakeholder is unlikely to reward its target audience with much more than the minimum income guarantee in retirement, according to figures from the ABI.

Its latest figures reveal that the average monthly payments into a stakeholder is just £81, giving a 35-year-old man a projected £134 a week at the age of 65 compared with the Mig of £92.15 a week.

The ABI warns that compulsory contributions will be necessary to halt the crisis in pensions exacerbated by the move away from final-salary schemes, which it says is widening the savings gap by £5bn a year.

The figures, published to mark the first anniversary of stakeholder&#39s launch, show that 750,000 people bought a stakeholder and 320,000 emp-loyers have set up schemes.

Norwich Union, Standard Life, HSBC and Lloyds TSB, including Scottish Widows, have led the chase for market share.

Hargreaves Lansdown pensions development manager Danny Cox says: “Stake-holder has succeeded in reducing pension costs across the board but for the target market it is not working. If people are averaging £81 a month, bearing in mind the minimum income guarantee, it is not enough.”

ABI director general Mary Francis says: “Current levels of take-up do not make a significant enough dent in Britain&#39s £27bn annual savings gap. The move away from final-salary schemes will widen the gap by up to £5bn each year.”


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