While you’re working, you’ll be used to a steady income. But what happens once you retire? You’ll need money to pay for bills, transport, accommodation and healthcare. And you’ll still want to do all the things you enjoy. 

So how much might you need and will you have enough in your pension savings?

A basic guide to retirement costs

The Retirement Living Standards (RLS) offer a general idea of how much you might need when you retire, in order to fund the type of lifestyle you want.

The RLS were created by the Pensions and Lifetime Savings Association (PLSA) and Loughborough University, and cover 3 different standards of living – minimum, moderate and comfortable.

These figures formed the basis of the lifestyle calculator that used to sit on this page. However they were updated in February 2024 to reflect the rise in the cost of living. The RLS are summarised below: 

Costs will be higher in London than those shown.

Visit the Retirement Living Standards website for more information, including a detailed breakdown of what is included in each of the standards. 

Please be aware that the results are illustrative only and should not be relied upon as a comprehensive figure, nor considered as financial advice. 

Working out what this means for you

You can use the RLS as a general guide of how much you might need in retirement.

If you want to be more specific, try listing everything you might need to spend money on and estimating how much that might cost you. You can use some of the details in the RLS as a guide or think about how much you currently spend.

This could include:

• Households costs, such as decorating
• Food shopping
• Transport, including car payments
• Holidays and leisure
• Clothing and other personal items
• Helping others, including birthday presents and charitable donations
• Care or medical costs

Once you have this, you can compare the estimated cost of your lifestyle to your expected income.  This includes:

• your State Pension – the amount you receive is set by the Government. You can request an estimate on the Government website. 
• your Amey OS Pension – Annual Benefit Statement (ABS), which shows your forecasted pension from the Amey OS Pension Scheme. 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.
• other pensions – you may have a private pension or pensions linked to previous employment. You’ll need to speak to each of the providers individually for estimates on those accounts. If you’ve lost their contact details, the Pensions Tracing Service may be able to help. It’s a free, Government-backed, service available online and over the phone on 0800 731 0193. Other companies offer a similar service but many charge a fee. Visit the government website to find out more.
•  savings and investments – if you have savings outside your pension, get those statements from your bank or other provider

Adding all of this up will help you work out if you’re on track to fund the lifestyle you want when you retire.

What you can do if the numbers don’t add up

If you’re worried that you might not have enough income when you stop work, there are a few things you might want to consider. For example:

• you may want to think about boosting your pension savings with Additional Voluntary Contributions (AVCs). AVCs are contributions you make in addition to your regular pension contributions. AVCs may be paid into the same or a separate arrangement to your regular pension contributions, but are usually still tax-free, subject to certain limits.
• Clearing your debts – if possible, consider pay off any debts you owe before you retire.

If you’re aged 45 to 65, you can try MoneyHelper’s Midlife MOT. It’s a government-backed tool designed to help you assess your current financial situation and plan for the future. It will tell you what to prioritise and link to guidance on how to improve your financial wellbeing from midlife through to retirement.

You can also seek independent financial advice – visit unbiased.co.uk to find an adviser in your area.