What will your future look like?
Do you know how much you will need to live on when you retire? When deciding on your target income in retirement, you need to think about where you will be living and how you will want to be spending your time.
Set your target
A good starting point is to consider your outgoings now, and then think about how your spending might change when you are no longer working. For example, you might have paid off your mortgage, but want to spend more on holidays than you do now.
The Pensions and Lifetime Savings Association (PLSA) has published some ‘living standards’ to give you an idea of how much to aim for in retirement. The standards tell you how much you might need to spend when you stop working to achieve a ‘minimum’, ‘moderate’ and ‘comfortable’ standard of living.
- Minimum - Covers all your needs, with some left over for fun.
- Moderate - Gives you more financial security and flexibility.
- Comfortable - Gives you more financial freedom and some luxuries.
To find out how much you might need to spend in retirement, use our target setting tool.