Older people should be prepared for their annual income to drop by two-thirds when they enter retirement, it is warned.
LV's latest State of Retirement report reveals that the average annual pension income, including state pension, is just £8,774.
This is significantly less than the typical annual salary of £25,480 for the over-60s, and around 24% lower than the minimum wage.
What makes the finding more worrying is the fact that a large proportion of retirees will have no pension savings left within 5 years of retirement, meaning they will rely solely on the state pension.
Some 19% of women do not have any private pension savings at all, compared with 12% of men who are in the same boat.
This group will therefore see their income fall by 78% as they potentially have to live on a 'pension wage' of just £110 a week.
Woman and men expect to work longer than anticipated
The report also reveals that 30% of women over the age of 50 expect to work longer than previously anticipated compared with 23% of men, while as many as 12% of retirees have outstanding credit card debt, 7% have an outstanding mortgage and 5% are overdrawn.
Women, meanwhile, will continue to suffer from the gender pay divide that currently exists in the workplace.
They will have to live on an annual retirement income of £6,580 - up to 40% less than the average income of £10,967 for men.
Other findings show that 30% of workers aged between 60 and 69 have altered their retirement plans in the space of the last 12 months, with 85% of these now expecting to retire later than they had originally planned.
Furthermore, 17% of those between the ages of 50 and 59 think they will have to work past the state retirement age due to financial reasons, while 19% intend to carry on working because they want to.
Some people are choosing to delay retirement rather than save more, with 10% having decreased their pension savings by an average of £50 a year. This equates to a total of £535 million lost in retirement savings.
Copyright Press Association 2014