How much money do you need to retire?
How much should you save for retirement? The answer depends on the person. One person may be looking for a retirement full of travel, while the other wants something more modest.
This brings difficulties when it comes to determining a pension policy, and as it prepares to announce the second stage of the government’s retirement investigation to focus on competence, it is a problem that should be dealt with. In the coming years, the state pension, workplace and private service is a business that will inform about thinking around.
Determining its goals very high may mean over -winnings depending on the pension of lower gains and the risk of financial struggle today. It can even save them completely. The very low risks of the rod, the high gains that go through life, thinking that they are doing enough and then get a bad shock.
Hargreaves laansdown savings and durability barometer looked at four basic sufficiency measurements that can help people work if they save enough.
Among them, “Pounds and Pen Measures”, which tried to put a real figure about what pensioners needed to achieve their retirement adequacy, were. The wage Foundation, which is among the Pounds and Pen measures, has a Life Pension Comparison, which determines a level of income to meet basic daily needs in retirement for single and unified households.
This can be seen as an absolute minimum that someone must save for retirement and sets a target for retirement contributions as a salary percentage (12%) or minimum cash amount (£ 2.950 for full -time life fee worker).
Read more: Key Questions to ask for yourself to plan a comfortable pension
Hargreaves Lansdown also evaluated the minimum, medium and comfortable living standards criterion of Pension and Lifetime Savings Association (PLSA) for single and unified household income.
The research looked at relative measures such as target change rates that determine an income level in retirement based on pre -retirement earnings. For example, they can say that someone should save enough to cover two -thirds of their pre -retirement salaries.
An existing pension expenditure measures has also been used. This determines a retirement income level in retirement by using existing retirement expenditures according to the income group, relationship status and term of office.
The analysis of these measures, which are found using Pound and Pen measures, may not reflect the existing living standards of high gains, thus converting them into a wrong sense of security. In addition, they can give the impression that low winners are behind, when they do not have to hit higher goals to protect their existing lifestyles.
