Using statistics from ONS, Partnership has highlighted that while the highest proportion of over-18s believe that they will be retired for 16-20 years, they are far more likely to be retired for over 30 years.

An estimated 30% of people will live for more than 30 years in retirement, according to the report.

Researchers said that this discrepancy is likely to cause significant issues to those who are basing their retirement income needs on perceived averages – especially if they have chosen pure drawdown rather than a combination of drawdown and annuitisation.

Report authors cited ONS data which suggested that at 65 years old, the average man would live for 21.5 years (4.5 years more than estimated) and the average woman for 23.7 years (6.7 years more than estimated).

Richard Willets, director of longevity at Partnership, said: “While the largest proportion of people assume that they will live for 16 – 20 years in retirement, the ONS data actually suggests they are more likely to live more than 30 years. Most people will work a margin of error into their retirement income planning but ten or more years is a significant period of time to make up from a finite pot of assets.

“Even those who have studied this subject extensively would struggle to definitively answer the question – how long will a specific individual live – so it is vital that people ensure they have some mechanism to guard against the consequences of underestimating their own vitality.”

Billy Burrows, of Retirement Intelligence, said: “While people may feel that they are being sensible by using ONS data to estimate the length of their retirement, using averages can go horribly wrong – especially if people have chosen to rely entirely on drawdown for their income. Therefore, I have chosen to work with Partnership to help people understand the various challenges they face when looking to plan their retirement under the new Pension Freedoms.

“There is a strong case for both annuities and drawdown in the right circumstances but for most people choosing a combination of the two will provide them with the security and access to cash that they aspire to. Indeed, choosing to add a guaranteed income for life to their portfolio means that they are safeguarding themselves against living longer than anticipated which while often desirable can mean that people face significant financial hardship in late old age.”