How much do I need to retire in the UK?

Retirement Projection in 2024

In a recently released report by the well respected and independent Institute for Fiscal Studies (IFS), a downside scenario is envisaged whereby 40% of UK based retirees would fail to hit the target of a minimum living standard in retirement.
 
Under specific assumptions in terms of investment returns and saving levels, 2 in 5 retirees would not achieve a retirement gross income of 67% of the current full time median earnings in the UK (£38,500), a percentage deemed to be a minimum living standard in retirement[1].

How much is enough to retire in the UK?

The Pensions and Lifetime Savings Association, in partnership with academics from Loughborough University, has tried to estimate and model different levels of income required to enjoy a minimum, moderate or comfortable standard of living in retirement[2].

How much does a couple need to retire in the UK? The answer for both couples and singles in retirement is detailed below.

How realistic is the possibility of achieving a comfortable standard of living in retirement?

 
Inflation easing, interest rates falling, albeit very slowly in the UK, increasing contributions to personal and workplace pension schemes and the maintenance of the “triple lock” on State pension benefits, are all element that should help in achieving the target.
 
However, volatility in financial markets is an ever present potentially disrupting variable.
In addition, the long-term sustainability for the public finances of the “triple lock” might come under intense scrutiny on the part of current and future UK governments.
 
In the words of the great ancient Roman orator Cicero old age, eventually, will “make us feel its unpleasant bite”[3], to which any added financial worry would be less than welcome.
 
Needless to say, well considered and accurate financial planning will be paramount to, in Cicero’ words, “live an easy life in happiness”[4] during retirement and old age.

Looking for expert advice from a local financial adviser?

At KLO Financial Services, we offer expert retirement planning services, from our team of independent financial advisers to help you plan ahead and secure the retirement you want and deserve, answering the key question of How much do you need to retire in the UK?

To speak to one of our personal financial advisers in Birmingham, Warwick and London, call 01926 492406 or email enquiries@klofinancialservices.com

[1] https://ifs.org.uk/publications/adequacy-future-retirement-incomes-new-evidence-private-sector-employees

[2] https://www.retirementlivingstandards.org.uk/

[3] Marcus Tullius Cicero “De Senectute”
[4] ibidem

Disclaimer

Any research is for information purposes only and does not constitute financial advice. The value of investments and any income from them may go down as well as up, so you may get back less than you invested. Past performance cannot be relied upon as a guide to future performance. KLO Financial Services Ltd are registered in the UK, company number 08711328. We are authorised and regulated by the Financial Conduct Authority, reference 710272. For any information please visit our website www.klofinancialservices.com