For the first time, researchers have calculated how much money a person needs per year in order to enjoy a comfortable retirement.
A new report from Loughborough University and the Pensions and Lifetime Savings Association (PLSA) aims to help people understand how much they will need for a minimum, moderate or comfortable quality of life once they retire.
For couples, the minimum standard came in at £15,700, moderate was £29,100 and comfortable worked out as £47,500.
The figures for London and the South East were slightly higher.
The results, published today, are based on consultations with members of the public and take into account what is needed in retirement for home DIY and maintenance, household and personal goods, holidays, food, transport, clothing and social participation.
Lead author Matt Padley, of Loughborough’s Centre for Research in Social Policy (CRSP), said:
This pioneering research for the first time looks at what the public agree you need for different standards of living in retirement.
We’ve known what society agrees is needed at the minimum for a long time now, but we now know what the public think you need for a moderate and a comfortable living standard as well.
This is important as there is currently very little to guide people in thinking about, planning and saving for retirement.
It’s all very well saying ‘I want a comfortable retirement’, but what does this look like and how much will I need to spend to have this living standard?
Through our detailed discussions with the public, we have explored just what this means. The research started by asking groups of members of the public to define these different levels and their key features.
A lot of this was about having greater security, flexibility and more choice in retirement than at a minimum living standard.
The research we have done doesn’t change the fact that retirement is a long way off if you are in your 20s or 30s, but it can help you work out what might need to be saving each month in order to have the kind of retirement that you want.
And the more we can encourage people to think about their financial futures the better.
For more information visit: https://www.lboro.ac.uk/media-centre/retirement-living-standards/