Workers need to save on average £390,000, plus state pension, to enjoy retirement

New research from life assurance firm, Standard Life, has revealed that a retiree needs to save at least £390,000, plus their State Pension, to cover their expenses throughout a 30-year retirement.

This latest calculation is based on a study which showed that, on average, Britons who retire this year plan to spend at least £21,000 a year.

The report, entitled the Class of 2021, also examined how ready adults planning to retire this year are and identified their concerns and hopes for retirement.

While the £390,000 outlines the amount that someone retiring soon needs to save, those looking to the future need to consider the impact of inflation.

Although inflation remains relatively low, the report states, Britons are likely to need far more than the £21,000 per year cited.

While many people are saving according to the study, around one in 20 of those retirees asked to take part intend to only rely on their State Pension.

Looking more widely at responses, based on the average planned spend of £21,000 per year in retirement, the report found that two-thirds of those planning to retire this year risk running out of money.

John Tait, Retirement Advice Specialist at Standard Life Aberdeen, said: “According to our research, almost one in five retirees say they plan to rely on one form of income in retirement.

“Pension pots are without a doubt the most popular option for that, but it’s so important retirees weigh up any other savings or assets when making the decision of whether they can afford to retire.”

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Posted in Financial Services.