It has been revealed that an average worker in the UK would have to survive their retirement years by living on just £215 a week, less than the current minimum wage.

The Fidelity Retirement Index shows that this is a 53% drop in income for the average British worker who brings in £457 a week. Whereas someone on minimum wage can earn approximately £220 for a 40-hour week.

Simon Fraser, president of the retirement institute at Fidelity International, said: “It is a shocking thought that, if this is not corrected, we could see the emergence of a generation of private pension paupers.”

The report blames this drop on defined contribution (DC) schemes beginning to replace defined benefit (DB) schemes. Those who are on a DB Scheme can expect to retire on two-thirds of pay after 40 years of service. Unlike those who are on a DC schemes who can expect just 38% of salary in retirement.