How Much Does Retirement Cost?
We can help you find out when you can afford to retire
Here at Retirement On Track, we are here to help people plan for their retirement, and know whether their retirement plans are realistic or affordable.
Many people simply wish to know how much retirement costs, and what steps they should take if these goals are not yet in reach. We provide retirement planning in Yorkshire for clients across the UK.
Making sure your retirement has no unpleasant surprises
People often underestimate the cost of being able to retire and maintain the lifestyle that they would desire. There are a number of reasons for this which we have set out below:
- The level of returns on investments can be overestimated.
- The number of years people live after they have retired can be underestimated.
- The level of returns on investments can be overestimated.
- Level of retirement expenditure can be underestimated.
- Investment returns are eroded by inflation.
|
What kind of retirement are you planning for? |
One person |
Couple |
|
Comfortable |
£37,300 |
£54,500 |
|
Moderate |
£23,300 |
£34,000 |
|
Minimum |
£12,800 |
£19,900 |
Source: Pension and Lifetime Savings Association
How much will you need for a comfortable retirement?
Are you wondering how much does retirement cost? It is important to consider the earlier you retire, the more funds you will need to maintain your retirement income, the table below demonstrates the fund size required to maintain a comfortable retirement and a moderate retirement at various retirement ages.
|
Retirement age |
Gross income required |
Pension Pot |
Gross income required |
Pension Pot |
|
55 |
£37,300 |
£700,000 |
£23,300 |
£390,000 |
|
57 |
£37,300 |
£660,000 |
£23,300 |
£370,000 |
|
58 |
£37,300 |
£640,000 |
£23,300 |
£355,000 |
|
66 |
£37,300 |
£450,000 |
£23,300 |
£220,000 |
|
67 |
£37,300 |
£430,000 |
£23,300 |
£210,000 |
|
68 |
£37,300 |
£410,000 |
£23,300 |
£200,000 |
Source: Quilter
Have Questions?
Considerations with your pension
We have assumed that a full state pension is payable and the initial fund has been calculated so that it lasts until age 88.
From the table above, you can see that a significant level of pension savings would be required for a single person to maintain a comfortable retirement to age 88 and more would be required if the retiree lives longer! For this reason, many factors need to be considered if you need to find out how much retirement costs.
Some retirees may have a company pension that is final salary in nature which provides a guaranteed annual pension, if this is the case, then a smaller initial pension pot would be required as it would only need to cover the balance of the income over and above the final salary pension.
Plan for the future today
Call 01977 285720, or email enquiries@retirementontrack.co.uk to get started.