Overview
- A 25-year-old would need about £3.1m by age 65 to reach the PLSA’s ‘comfortable’ standard, requiring roughly £1,600 a month with contributions rising 2% annually and assumed 5% annual growth.
- The analysis applies PLSA benchmarks and a 2% inflation assumption over 40 saving years and a 25-year retirement, with the current-day equivalent put at about £1.4m for someone retiring now.
- For couples, the combined target for a comfortable retirement is around £4.3m, while a ‘moderate’ lifestyle is estimated at £2.2m for an individual and a ‘minimum’ lifestyle at about £947,700.
- The projections exclude state pension income, currently worth up to about £11,975 a year, and omit potential costs such as housing, social care and tax on withdrawals, so actual needs could be higher.
- Rathbones’ Rebecca Williams called the figures “shocking,” citing pressures from housing costs and student debt, and urged early saving, maximising workplace matches and, where possible, family support.