The Pensions and Lifetime Savings Association puts the income a single person needs in retirement at £13,900 a year for a minimum standard of living, £32,700 for a moderate one and £45,400 for a comfortable one, after tax and with housing costs paid off. The full new State Pension of £241.30 a week provides £12,548 of that. Drawing 4% a year from a pension pot, the moderate standard needs a pot of about £504,000 and the comfortable one about £821,000, which over 30 years means saving roughly £870 or £1,420 a month including employer contributions and tax relief. A couple sharing costs needs less per head: two State Pensions cover the minimum standard entirely.
The three living standards
| Standard | Single person | Couple | What it covers |
|---|---|---|---|
| Minimum | £13,900 | £22,500 | Essentials, a week’s UK holiday, no car |
| Moderate | £32,700 | £45,400 | A car, a fortnight abroad, eating out a few times a month |
| Comfortable | £45,400 | £62,700 | Two cars replaced regularly, three weeks abroad, more spending on home and leisure |
The standards are after-tax incomes for people who own their home outright; renters or those still paying a mortgage need to add housing costs. They are averages built from focus groups rather than targets everyone should hit, but they give the two figures that matter for planning: how much beyond the State Pension has to come from private saving, and therefore how large a pot is needed. The retirement income target calculator runs the sums for any target, State Pension figure, years to retirement and existing savings.
The pot each standard needs
| Standard | Income needed from savings after the State Pension | Pot needed at a 4% withdrawal rate | Monthly saving over 30 years |
|---|---|---|---|
| Single, minimum | £1,352 | £33,810 | £58 |
| Single, moderate | £20,152 | £503,810 | £871 |
| Single, comfortable | £32,852 | £821,310 | £1,419 |
| Couple, minimum | £0, two State Pensions exceed it | £0 | £0 |
| Couple, moderate | £20,305 | £507,620 | £877 |
| Couple, comfortable | £37,605 | £940,120 | £1,625 |
The monthly figures assume 3% growth a year above inflation and no existing savings, and they are gross contributions: the total going in from you, your employer and tax relief. An employee earning £40,000 in a scheme paying 5% from them and 3% from the employer already puts in about £267 a month, and a basic rate taxpayer’s £871 gross costs £697 from take-home pay. The 4% withdrawal rate is a common planning rule for a pot that has to last 25 to 30 years; a lower rate is safer and needs a bigger pot. Our guide to how much to pay into a pension covers contribution levels and tax relief, and the pension contribution calculator shows the take-home cost of any percentage.
Starting age changes everything
| Years until retirement | Monthly saving for the single moderate standard |
|---|---|
| 10 | £3,613 |
| 20 | £1,541 |
| 30 | £871 |
| 40 | £549 |
Someone who starts at 27 needs to save £549 a month to reach the moderate pot by 67; someone who starts at 47 needs £1,541 and at 57 needs £3,613. Existing savings cut the requirement sharply: a 37-year-old with £100,000 already in pensions needs £451 a month rather than £871, because the £100,000 grows to about £243,000 in today’s money over 30 years. The pension pot projection calculator shows what current savings and contributions produce at any retirement age.
Turning the pot into income
| £500,000 pot at 67 | Annual income |
|---|---|
| Drawdown at 4% | £20,000, rising if the pot grows, the capital remains |
| Level single-life annuity at 7.9% | £39,500 for life, fixed, nothing left on death |
| Annuity rising 3% a year at 5.4% | £27,000 initially, rising each year |
| Joint-life level annuity at 7.1% | £35,500, continuing for a surviving partner |
An annuity pays roughly double the 4% drawdown rate because it spends the capital as well as the return and pools longevity across buyers, but the income is fixed and the money is gone. Many retirees combine the two, buying an annuity to cover essential spending with the State Pension and drawing down the rest. Annuity rates depend on age, health, gilt yields and the options chosen; the rates above are illustrative and the annuity calculator applies a chosen rate to any pot. The first 25% of the pot can be taken tax free, as our tax-free lump sum guide explains, and the State Pension forecast calculator checks how much of the £12,548 your National Insurance record has earned.
Common questions
How much do I need to retire comfortably? About £45,400 a year after tax as a single person or £62,700 as a couple on the PLSA comfortable standard, which needs a pot of roughly £821,000 for a single person after the full State Pension, or £940,000 for a couple.
Is £500,000 enough to retire on? For a single person with a full State Pension, yes for the moderate standard: 4% of £504,000 plus the State Pension gives about £32,700 a year.
How much should I save each month? Around £870 a month gross over 30 years for the single moderate standard, including employer contributions and tax relief; £550 over 40 years or £1,540 over 20.
What is the 4% rule? A planning rule that a pot can pay out 4% of its starting value each year, rising with inflation, with a good chance of lasting 30 years. It is a guide, not a guarantee.
Does the State Pension count? Yes. The full new State Pension of £241.30 a week, £12,548 a year, covers most of the minimum standard and about 38% of the moderate one for a single person.
Should I buy an annuity or use drawdown? An annuity gives certainty and a higher starting income; drawdown keeps the capital and flexibility with investment risk. Many people use both.
Information, not financial advice. Living standards are the PLSA Retirement Living Standards as published at retirementlivingstandards.org.uk; the State Pension is the 2026/27 full rate; pot and contribution figures are from the site’s calculator at a 4% withdrawal rate and 3% real growth, and annuity rates are illustrative. Retirement planning depends on individual circumstances, so take regulated advice before acting on them.