UK adults estimate that £25,783.87 net of tax per year in retirement, or £33,772.35 gross of tax in the 2013/14 tax year*, would be ‘enough to maintain a comfortable standard of living'.
With a basic state pension during the 2013-14 tax year of £5,727.80, individuals still require about £28,000 gross each year from their private pensions to reach the average gross target.
20 per cent of 50-59 year olds have no idea whether or not they are on track for their retirement savings, while 12 per cent are considering delaying or have already decided to delay their retirement.
Andy James, advice policy manager at Towry, responds to today's Chancellor's Budget and underlines the importance of ensuring you take responsibility for your own retirement pot.
"Today's Budget has thrown up few surprises for those at or approaching retirement, although the announcement to bring forward the proposed flat tier state pension to 2016 is welcomed for a system in real need of simplification.
"A study by Towry has shown that the basic state pension represents only around 17% of the average gross amount UK adults feel is enough to maintain a comfortable standard of living. This figure will only rise to around 22% even after the flat rate state pension comes into force.
"The cap on social care costs also announced today, set to protect savings above £72,000 and raising the means test on residential care to £118,000 from 2016, offer some relief to those worried that a large proportion of their assets would disappear into a care costs black hole. Yet the relatively few pension-related announcements in the Budget are a stark reminder to people that they must take their own steps to build a suitable retirement pot to meet their needs.
"Our research found that only 29 per cent of those aged 60-69, and 16 per cent of those aged 50-59, have already achieved a level of savings that they are confident will comfortably fund their retirement, and the Government will do little to help those concerned about the size of their retirement pot. In many cases, people have no idea about whether they are on track for a reasonable retirement income; in many other cases they are being forced into delaying their retirement.
"Careful financial planning is the most sensible way in which people can ensure they gain the maximum benefit from their money. The onus is on the individual to make sure that they save enough money to ensure that they achieve the retirement they want, especially with life expectancies continuing to rise."
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