Comfortable retirement

What do you need to retire comfortably? The answer may have just been found!

Anthony Murphy

Posted on: 18th October 2019

This is a question we all yearn to answer, yet we do not ever really know until we are fast approaching retirement and understand what standard of living we would like to have a comfortable retirement. But do not fear – researchers at Loughborough University and the Pensions and Life Savings Association have produced a report to help people understand what is required for differing levels of quality of life and what is required for a comfortable retirement.

State Pension is not enough

The research obtained views from 26 group discussions with the a selection of the general public across the socio-economic scale and life cycles, alongside expert analysis to determine what each level of retirement meant and what the costs associated with the different aspect of living were such as the amount needed for nutritional needs, utilities, transport etc.

Whilst most retirees will be eligible for a full state pension, currently set at £8,767, the research shows that a single pensioner will require a further £2,500 per annum to achieve a minimum quality of living and couples may survive on their joint state pensions.

Credit: Loughborough University, Developing Retirement Living Standards, October 2019

Whilst £20,200 per annum may seem like an unattainable goal, this level of research and the introduction of auto-enrolment will assist in quantifying what retirement costs and what is achievable through early changes in the retirement planning journey.

Achieving subjective aims objectively

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.”

More information on the research can be found here or if you require some weekend reading, you can read the full 48-page report here.

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However, if you prefer the face to face approach and would like to secure your retirement and attain the comfort you deserve, why not get in touch and one of our Financial Planners can help you make those first steps towards a prosperous retirement.