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Simply meeting people’s financial needs

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How much will you need to live on?

The general rule of thumb is that you’ll need between half and two-thirds of the income you had when you were working to have a comfortable retirement. This is just a rough guide though.

Review your outgoings

It’s useful to work out your own outgoings so you can estimate how much you’ll need. Some of your costs will go down when you retire, for example if you’ve paid off your mortgage or other debts. However, some may go up, such as fuel bills or entertainment.

This list should get you started:

rent or mortgage
gas bill
electricity bill
council tax
water rates
landline, mobile and internet
food and alcohol
travel and motoring
entertainment and going out
credit cards

How long will your money need to last?

This depends on when you retire and leave paid employment. Putting it bluntly, your pension and other savings will need to last for as long as you do. And longer if you’re providing an income for a loved one who outlives you.

If you retire at 65 today, you can expect to live for approximately another 20 years. Of course everyone is different and you might live much longer than this.

You’ll receive your State Pension until you die, but your employer and personal pensions need to be carefully managed to last your lifetime.

What lifestyle do you want?

Your State Pension will provide a modest income, but probably won’t pay for the retirement you have in mind. If you want to continue enjoying life like you do now, you need to save towards it.

You may find you’re spending more in the early years of retirement on travel, new hobbies or spending time with your family, but remember you might need to pay towards your care as you get older.


Inflation is the changing cost of household items. Over time, inflation will push prices up, which means that your pension won’t buy as much as it did before.

So, in 20 years’ time, you’ll need more money than you do today to buy the same goods and services.

Next: Will you have enough retirement income? »