![]() The UK State Pension of £134.25 per week is below the average retirement income of £361, as many retirees are relying on private pensions to make up the difference. ![]() Their calculator uses real rates of return showing the estimated return with market expectations for inflation included. You can use the pension calculator†, provided by Profile Pensions, to see what your contributions and pension savings could be at retirement adjusted for inflation. This means that a retired person may need between an additional £1,372 and £24,372 a year to hit these targets. ![]() The current full new State Pension provides pensioners with £9,628 a year. To live moderately, a pensioner would need £21,000 a year and, to live a more comfortable lifestyle (long-haul holidays and car replacement etc.), you would need £34,000. What is a good pension pot?Īccording to Retirement Living Standards, a single pensioner would need a pension income of £11,000 to live an ‘essential level’ lifestyle in retirement. ![]() So 18 years multiplied by £14,000 would mean a pension pot of £252,000 at retirement. If they retire at 67, you would usually plan for their pension to last until they’re 85. You can then multiply this amount by the years you expect to be in retirement.įor example, someone with a salary of £20,000 would need £14,000 a year in retirement. Other people follow the 70% rule, where you aim for an income in retirement of 70% of your current salary. Some pension advisers recommend having a pension pot that is 10 times your current salary.įor example, if your salary is £15,000, you might aim for a pension pot of £150,000 to see you through retirement. This can be used as a quick estimate, however it is best to speak to an adviser. The ‘50-70’ rule suggests that you need to aim for an annual retirement income that is between 50 and 70 per cent of your working income in retirement. You should consider when you want to retire, how much you need to live on each year and the amount of State Pension you are entitled to. ![]()
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