How much do you really need to retire comfortably?
Published 24 November 2025
You might worry sometimes, wondering:
“Have I saved enough?”
“Will my pension let me live the life I want?”
Retirement can feel like a moving target: you hear big numbers, conflicting advice, and uncertainty about what “comfortable” even means. There is no single magic figure.
What you need depends on your goals, your lifestyle, where you live, and your sources of income. In this article, we will break it down in clear, human terms. We will use UK-based research and explain the “standards” you can aim for.
Most importantly, by the end you will have more clarity, and you will know how to take action (and yes, you can always book a call with Shalini Kanap, female financial adviser, if you want someone to walk beside you through this).
What “comfortable retirement” means in the UK
To reduce uncertainty, financial organisations in the UK use frameworks called retirement living standards (RLS) or Pension and Lifetime Savings Association (PLSA) standards. These show what different levels of retirement might look like in reality, rather than just theory.
According to the PLSA’s retirement living standards:
Minimum standard (for one person): ~£13,400 per year (or £15,800 if you live in London)
Moderate standard: ~£31,700 per year (or £33,000 if you live in London)
Comfortable standard: ~£43,900 per year (or £45,700 if you live in London)
For couples, those figures shift to roughly £21,600 minimum, £43,900 moderate, and £60,600 comfortable. For couples in London that are reading this, then £24,800 minimum, £45,500 moderate, and £62,700 comfortable.
These figures assume no extravagant luxuries but enough freedom to travel, entertain, maintain health, and enjoy life without strict budgeting. They do not always account for housing costs, so if you have not paid off your mortgage by retirement, you rent or you plan to move later in life, those must be layered on top.
You can read more about the detail in these figures here (Pensions and Lifetime Savings Association, Retirement Living Standards report developed in partnership with Loughborough University Research faculty June 2025).
What income sources could you have in retirement?
State pension
The full new state pension in 2025–26 is £11,973 per year (or about £230.25 per week). Many women have career breaks or part-time working years, so it is worth checking your National Insurance record and seeing whether you have gaps that reduce your entitlement.
You can check your state pension forecast here. Make sure you only use the official Government Gateway log in, and not share your personal details to another website unintentionally .
Private and workplace pensions
Defined contribution (DC) pension pots that are built by contributing and investing
Defined benefit (DB) pensions guarantee you an inflation linked annual income (these are rare outside the public sector nowadays, but valuable if you have any)
Other savings, investments, and assets
Stocks & shares ISA
Property (e.g. rental income or equity you might unlock later)
Cash savings and other investments
When you add together guaranteed income (state pension + DB pensions) along with your potential income from your DC pensions and other assets, you see how much more you need to reach your target.
How to calculate your estimate pension pot to target
Step 1: decide your desired annual income
Pick a standard you want (minimum, moderate, comfortable). For example, say you aim for £43,900 per year (comfortable, single and outside London).
Sense check this by looking at your outgoings at the moment, and deduct anything that will stop in retirement, such as a mortgage or loans for example. Make sure you consider bills but also fun spending (such as holidays, eating out, any other purchases).
Refer back to your recent bank statements as you will likely find spending that you do not spring to mind.
If the PLSA’s retirement living standards figure is significantly different, it would be sensible to consider 2 scenarios, 1 with their figure and another with your figure.
Step 2: subtract your known income
If your state pension and a DB pension will cover £15,000, then you still need £28,900 more from your DC pensions and investments.
Step 3: apply a withdrawal or conversion rule
Two common rules are:
4% rule: you withdraw 4% of your pot per year, adjusted for inflation
Annuity conversion: convert your pot into guaranteed income
For example, if you need £28,900 and plan to use the 4% rule, you would need a pot of around £722,500 (28,900 ÷ 0.04).
Alternatively, using annuity conversion rates (which vary) you might need a similar or somewhat higher pot depending on age and desired guarantee. You can compare annuity rates here.
4% is just an example figure used. If the income taken exceeds the growth on the investment, the capital will be eroded.
What the research says: are people underestimating how much they need?
Yes, many are.
3 in 5 UK adults doubt they will achieve a moderate standard of retirement
Just 28% feel confident they can achieve this reality.
Just 15% of those aged 45-54 and 55-64 are confident they will have £500,000 saved by retirement. Similar levels are reported by those aged 65-74 (17%) and likely to be at or already in retirement.
This compares to 32% of those aged 35–44 being confident in achieving a moderate standard of living in retirement and 40% of those aged between 16 and 34 feeling confident they’d be able to save £500,000 by the time they retire.
The low percentages particularly for those closer to retirement is concerning. This also highlights the importance of starting early and having a plan.
Source: Real Life Financial Health Report, 2025
Research conducted for St. James's Place by Opinium surveyed 8,000 UK adults nationwide between 22 July 5 August 2025.Quotas and post-weighting were applied to the sample to make the dataset representative of the UK adult population. 2211 of those surveyed were aged 18-34.
A worked example: Anna’s path
Let’s imagine someone like you:
Anna, age 45
State pension expected: £11,973
She has a pension pot of £120,000
She wants a “comfortable” income of £43,900
She calculates:
Required extra income = £43,900 − £11,973 = £31,927
Using 4% rule: she needs pot of ~£798,000 (31,927 ÷ 0.04)
She has £120,000 already, so she still needs ~£678,000
Over 22 years (retiring at 67), she would need to save and invest to grow that gap.
Depending on expected return, time, and risk, she may choose to boost contributions, extend working years, or adjust her target slightly.
The above example is for illustrative purposes only and does not reflect real companies or clients. Your numbers will differ. But it shows how you can break it down piece by piece. If you want to go through your numbers, book a call here.
Practical steps if you feel behind
Increase contributions now
Boosting your pension contributions, even by just 1–2% today can make a significant long-term difference. If you are employed, check if your employer will match any extra contributions you made, as this can double the value of what you are paying in yourself.
Use tax-efficient wrappers
Max out your pension allowance and ISAs to keep more of what your money earns.
Check investment performance of DC pensions
Often pensions are paid into over decades and forgotten about. But without it being reviewed, often investments are no longer suitable for the change in market conditions. Make sure you review them annually, as even a 1% lower growth over decades can erode a big amount of growth.
Adjust your plan as you go
Revisit your target every year. As your pot grows or your goals shift, your gap will change.
Consider working longer or part-time post official retirement
Extra years of contributions plus fewer years needing a pot gives you breathing space.
Diversify your sources
Do not rely solely on your pension. Other investments or passive income could plug part of the gap too.
Overcoming the fear and mindset blocks
It is perfectly normal to feel behind or worry that your numbers are too big. You are not alone in that.
Start small: 1% more of income or 1% extra contribution
Focus on what you can control (your savings rate, your investment growth, your direction)
Reframe: it is about progress, not perfection
Lean on support: an adviser, peer group, or someone who will explain in plain English
Start ASAP: the earlier you start, the less you will have to do
Bridging to other blogs you will love
While this article explores how much you might need, you may want to learn more about how to act today or how to lean into your strengths. Check out:
The difference between wealth management and financial planning
Why your relationship with money matters in financial planning
Conclusion
Understanding your retirement target does not need to feel overwhelming. The secret is breaking it down: decide your income goal, tally what you already have, spot your gap, then build a plan step by step.
If any of this feels heavy, confusing, or you would like a second pair of eyes, you do not have to do it alone. Book a call with Shalini Kanap, female financial adviser, and let us help you translate your goals into a path you feel confident walking.
The value of an investment with St. James's Place will be directly linked to the performance of the funds you select and the value can therefore go down as well as up. You may get back less than you invested.
The levels and bases of taxation, and reliefs from taxation, can change at any time and are generally dependent on individual circumstances
Frequently asked questions
1. Will inflation ruin these retirement estimates?
Yes, inflation is a key risk. That is why your plan should include a margin - or assume slightly higher returns - and be revisited regularly.
2. What if I retire earlier or later than 67?
If later, you shorten the time your pot has to last and get more contributions; if earlier, you may need a larger pot to cover more years.
3. Can I live comfortably on only a state pension?
Likely not for a “comfortable” standard. The state pension might cover part of a minimum lifestyle, but additional income is almost always needed. Also, the state pension rules may change in future, so I recommend against relying solely on this.
4. Are the 4% rule and annuity conversions safe?
They are guidelines, not guarantees. Use them carefully, and plan for contingencies. They are useful starting points only.
5. Should I get financial advice now or wait until I am closer to retirement?
As early as possible is better. A good adviser helps you set realistic targets, avoid pitfalls, and give mental peace along the journey. The earlier you start to save the better, because of compound growth.
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SJP Approved 20/11/2025
