A 25-year-old today aiming for a comfortable retirement at 65 would need a pension pot of £3.1 million, according to investment firm Rathbones. For a two-person household, the figure rises to £4.3 million. The estimate assumes 2% annual inflation, contributions increasing by the same rate, and average growth of 5%.
To achieve this, a single person would need to save approximately £1,600 per month. The analysis also found that a 'moderate' lifestyle would require £2.2 million, while a 'minimum' lifestyle would need £947,700. These figures highlight the challenge for young workers, particularly those in lower-paid professions.
Rathbones defines a comfortable retirement as including annual overseas holidays, UK weekend breaks, some luxury, eating out, and spontaneity. For those retiring at 65 today, the firm estimates a comfortable 25-year retirement requires £1.4 million.
Pension experts suggest a general target of having three times your salary saved by your 30s and six times by your 50s, though individual circumstances vary widely.
