The cost of a comfortable retirement has risen, with a single person now needing £43,100 annually to achieve a “comfortable” retirement standard, according to the latest figures
Pensioners who earn less than £43,100 a year have been issued a stark warning as the cost of a comfortable retirement soars. According to the latest figures, a single person now needs an annual income of £43,100 to maintain a “comfortable” retirement, while couples need £59,000.
“The cost of living has put enormous pressure on household finances over the last year and, as the research shows, this is no different for retirees,” said Nigel Peaple, Director Policy and Advocacy at PLSA.
He added, “It’s important for workers saving for retirement to remember the standards are not prescriptive targets. They are a tool to help you engage with the type of spending you think you will do in retirement and to help you plan for it.”
Peaple also noted, “It is worth highlighting that a couple who each has a full entitlement to the state pension will achieve the minimum level, and if each is paid average earnings throughout their working life, they have a good chance of enjoying many aspects of the moderate living standard.
“Working and saving is likely to vary over a lifetime, for example taking time off to have children, so it is important to adapt workplace pension contributions to make up for periods not saving.”
To achieve a “minimum” retirement standard, a single person now needs an annual income of £14,400, which is up from £12,800 the previous year. This basic level covers weekly groceries of around £95, a UK holiday each year, and a monthly meal out. The cost of running a car is not feasible with this annual income.
For those looking for a “moderate” retirement lifestyle, single individuals require £31,300 each year – an eye-watering £8,000 increase on figures from the previous year. Couples aiming for this moderate retirement should budget for £43,100 annually, jumping up from £34,000, which should cover £100 on groceries every week, having a small second-hand car, and European holidays.
