How much will I need for retirement?

Common questions we are asked as financial advisers are “Will I have enough money when I retire?” and “How much is enough for retirement?”

There is no ‘one size fits all’ solution when it comes to retirement planning, and we could have different answers for every individual based on their circumstances.

Research from the Pensions and Lifetime Savings Association (PLSA) highlights that 77 per cent of pension savers are unaware of how much they will need in retirement, which is why the Retirement Living Standards have been developed – painting a picture of the lifestyle you could have in retirement.

According to the Standards, £20,800 per year will be enough for a single person to live on for a ‘moderate lifestyle’, or £33,600 for a ‘comfortable lifestyle’, and for couples, it is £30,600 and £49,700 respectively, but what does this mean for you, and how can you ensure you will have enough to sustain the lifestyle you require?

When planning for retirement, it is important to consider seeking support and guidance from an experienced financial adviser.

Typically, your adviser will work with you to establish a clear understanding of what income will be required to support your proposed retirement, when you plan to retire and what assets are already in place.

With this information, advisers can build a cashflow model, using sensible assumptions, to work backwards and highlight what you should be saving.

This clarity is often enough to spark the appetite for an individual to begin implementing a clear financial plan for retirement.