Retirement Living Standards

Retirement Living Standards

Pensions aren’t necessarily thought about much, until an individual is nearing their retirement age. However, the Pension & Lifetime Savings Association (PLSA) is trying to change this, with their Retirement Living Standards, which they hope will become as well known as the ‘5-a-day’ moniker. The idea is to help people have an idea of how much it was will cost them each year in retirement, which should, in turn, allow them to aim for a savings target.

These standards set out the cost of a year of retirement, based on the level of comfort aimed for – i.e. how many holidays would be planned, meals out each month etc. They hope that these clear goals will encourage further Pension savings, to enable people to have the retirements they dream of.

For a Single Person the Standards state that this will be most much is required each year:

  • Comfortable Retirement – £43,000
  • Moderate Retirement – £31,000
  • Minimum Retirement – £14,000

For a couple, the Standards state:

  • Comfortable Retirement – £59,000
  • Moderate Retirement – £43,000
  • Minimum Retirement – £22,000

These basic living requirements have increased quite a bit over the last few years, with the increases in costs of living and may well surprise some people. Most retirees will receive up to £11,500 as their New State Pension from the government each year. But, as you can see, this along doesn’t cover the minimum standard of living (unless in a couple), so personal pensions will be required too.

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