Pension: What do you need for a ‘comfortable’ retirement? The exact figure to bear in mind

Martin Lewis lays out the two types of pensions

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Pension savers will not want to be left with regrets regarding a failure to plan amply for retirement. As such, it will be vital to think ahead and budget for each year of retired life.

People might have a particular idea in mind for retirement, but a study has uncovered the figure people should be looking for.

According to the Pension Lifetime Savings Association (PLSA), a single person will need to spend about £11,000 a year – but only if they want the minimum living standard in retirement.

If looking for a moderate lifestyle, then singletons will need £21,000 a year.

However, for those with more lofty ambitions such as longer holidays and spending on regular gifts, £34,000 is required – deemed as a “comfortable retirement”.

The PLSA’s Retirement Living Standards has also unpacked the sum couples will need for retirement.

For the minimum living standard, couples will need at least £17,000 budgeted for the year.

Taking it a step up to a moderate retirement, £31,000 is likely to be necessary.

Couples looking to live out their later years comfortably will need at least £50,000 a year according to the latest figures.

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The numbers are to be updated once again in October to provide Britons with an ongoing picture.

New figures will reflect the changes in the prices of goods and services bought by pensioners.

The PLSA hopes its standard will become a similar tool to the five-a-day health eating initiative.

They could become a rule of thumb for retirement planning, and spark conversation about pension saving.

Pension savers should note the figures also take into account the state pension.

The full new state pension is currently worth approximately £9,627.80.

This could go at least some way to helping the incomes of retired people once they leave the workforce.

Up to 35 million savers have now accessed the PLSA’s Retirement Living Standards.

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The contact has been made through pension schemes, making more people aware of their finances.

In total, 124 organisations are now using the standards, including over 100 pension schemes.

Nigel Peaple, Director of Policy & Research PLSA, said: “It has been enormously encouraging to see so many pension and savings organisations proactively using the Retirement Living Standards to help bring pension saving to life.

“Reaching up to 35 million savers, the Retirement Living Standards are now firmly established as part of a common language to help people engage with pension saving and understand their spending needs in retirement.”

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