Generation X – the so-called ‘squeezed middle’ – are facing a painful retirement without adequate pension provision, guaranteed inheritances or independent financial advice.

A study among people aged 39 to 54, carried out on behalf of Dunstan Thomas among more than 2000 Britons, has shown Gen X faces a bleak future when it comes to retirement, with the loss of defined benefit schemes, a reduction in the number of advisers since the Retail Distribution Review, and financial pressures on all sides.

While the average pension savings of UK Gen X is £159,837, putting in just over £200 a month, this will not be enough to secure a comfortable retirement, based on current assumptions.

Gen X are most likely to be in defined contribution schemes, bearing all the investment risk themselves during accumulation, and face the prospect of having to rely on whatever state pension benefit awaits them down the line.

Despite all of this, and in spite of the fact that 55 per cent admitted they were not saving enough to maintain their lifestyle in retirement, with 22 per cent claiming to have no pension whatsoever, a significant proportion had never heard of pension freedoms and had little idea what to do with their money in retirement.

Some 38 per cent said they did not want to think about retirement “because it worries me so much” and 42 per cent were hoping to receive an inheritance before they retire.

The survey also revealed a persistent gender divide when it comes to Generation X. While the average UK pension savings pot is worth £186,611 for Gen X men, their female counterparts have just £117,854 in pension savings.

Adrian Boulding, director of retirement strategy for Dunstan Thomas, said there was a ‘perfect storm’ approaching when it comes to the financial futures of Generation X because of the closure of large swathes of the defined benefit market; auto-enrolment coming too late for older Gen X; changing working practices and demographics; and lower levels of access to financial advice after the Retail Distribution Review.

“All these are major factors influencing Gen X’s retirement saving levels. The result is that approximately only 5 per cent of 39-54-year olds are on track to fully fund even moderate retirement lifestyles.”

If you are looking for pension advice, speak with an adviser on 0191 384 1008.