The good news from recent ONS data is that we are expected to live longer; the bad news from the recent Aegon research suggests that our retirement income will run out 6 or 7 years before we die (for women and men respectively).

Current life expectancy figures from the ONS predict that a 65-year-old will live to 83 if a man and 86 if a woman. 

The problem seems to be that the ONS data is calculated on average life expectancy using a method that doesn't account for changes in the mortality rate over time. If mortality improvement data is applied, as the Aegon research did, then the average life expectancy could be 7 years longer for a man at 90, and 6 years longer for a woman at 92. 

With the advent of defined contribution pensions and the increased freedom and choice, a  65-year-old man retiring with £250,000, using Aegon's modeller, would need to save a further £66,000 to maintain income levels for these 'extra' years.

This size of this expectation and savings gap should not come as a surprise. Modelling and averages cannot predict reality and anyone with a passing memory of maths will know that all answers are predicated on the input, the assumptions made as well as the methodology. 

What this should tell us - loudly and clearly - is that anyone standing at the precipice of retirement should take advice on which choice to take at that moment and review their retirement savings on a regular basis thereafter.

Things change over time; people's needs, financial plans and performance and their health. Expecting to reach a decision at retirement and then not to regularly revisit it is unlikely to lead to the best outcome.

The other clear message is that when saving for retirement, people should ideally over-estimate their future income needs. This will not only give them more choice at retirement and in retirement, but it could also build in a buffer for those expected 'extra' years of life they may gain.  

These are complex and difficult concepts and are well beyond the reach of many ordinary employees which is why more need access to guidance and advice during their pension savings years, at retirement and throughout their retired lives.