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22 February 2024

The cost of retirement is going up

New figures show that the cost of retirement is going up so it’s important to plan ahead to ensure you have the level of income you expect at retirement.

The Retirement Living Standards (RLS), created by the Pensions and Lifetime Savings Association (PLSA) and Loughborough University, estimate how much you might need in retirement each year, based on 3 different standards of living – minimum, moderate and comfortable. 

According to the latest figures, costs have increased across all 3 levels for the second year in a row, with rises of up to 34%. This means to enjoy a moderate standard of living in retirement, a single person will now need £31,300 a year, that’s £8,000 more than suggested last year. While a couple living a moderate lifestyle will need an extra £9,100, with an annual income of £43,100.

Slightly smaller increases were suggested in the other lifestyle categories, but still represented a rise of 12% for those wanting even the minimum standard of living when they stop work.

The latest RLS figures are shown below, along with some suggestions on what you can do if you’re worried you won’t be able to afford the lifestyle you want.

Costs are higher in London and can be found in full at

Why have the Retirement Living Standards increased?

The RLS are reviewed regularly and updated to reflect rising prices, and the public’s expectations of what retired people will need, not just to survive, but to “live with dignity” in their life after work.

The PLSA say that rising prices of domestic fuel and energy costs are the most significant factor in increasing what is needed this year.

Other factors include the soaring prices of:

  • Food and groceries
  • Social and cultural participation, such as spending time with family and friends out of the home
  • Motoring costs

Using the Retirement Living Standards and reaching your savings goal*

Research has shown that having something to aim for makes it more likely you will reach your goal. You could use the Retirement Living Standards as a general guide to how much you might need when you stop work, and to help you set a savings target for your retirement.

You could also try listing all of your expenses to get a personalised idea of how much you might need.

Work out if your pension adds up

To work out whether you’re on track to afford the retirement you hope for, you’ll need to compare your likely spend with the amount of income you’re likely to get.

You can see what the income from your Amey OS pension might be by checking your Annual Benefit Statement. You can also  contact your Scheme administrator, Railpen, to request your current estimate by calling 0345 112 0025. However, you may only request two free estimates in any calendar year.

If your forecasted pension figures don’t match up to what you’re aiming for, don’t worry. There are steps you can take to improve your expected retirement income. This includes:

  • Thinking about your broader financial circumstances and looking at your retirement income in the round. This includes:
    • Thinking about any other pension arrangements, or other sources of income you may have. For example, you could think about when you might be able to take your State Pension. You can check your State Pension age (SPA) here.
    • Thinking about whether there are things you can do now, while you’re working to reduce your outgoings.
    • Thinking about when you plan to retire and whether you could consider working for longer

Get help from a financial expert or adviser

Pensions can be confusing. If you’re thinking about making changes to your pension, or taking your retirement benefits, it’s a good idea to take financial advice. You can find a list of Independent Financial Advisers (IFAs) at


*Figures from The Retirement Living Standards (RLS) and Lifestyle Calculator Tool are based on the income you may need after tax