Our team of specialists has investigated and determined how much you need to retire in each UK county comfortably. The recent announcement of raising the state pension from £185.15 to £203.85 per week, as well as the raising of the retirement age to 67 years old, prompted the research of this piece.
The team at Bower used the 50-70% ratio for retirement income to determine the amount of pension money required to live comfortably in each county. For your retirement, the 50-70 rule states you should try to reach a level of income that is between 50% and 70% of your annual salary. In this case, the team used 50% for a minimal lifestyle and 70% for a comfortable lifestyle, using the average salary per county/country in the UK in 2023.
It isn’t always possible to reach this level of income, particularly in today’s economic climate, and for those who need to consider other options to help with later life finances, a lifetime mortgage is something to be considered. Comprehensive, independent and qualified advice is essential to ensure all pros and cons are considered.
Predictably, London tops the list. You will need a considerable pension fund to maintain a particular standard of living throughout your retirement in London, with the North East having the lowest yearly income needed for a comfortable retirement overall.
As life expectancy increases, it is important to plan ahead and ensure that you are adequately prepared for retirement. The UK Government provides a range of pensions and benefits to help people plan for retirement. As well as the State Pension and possibly pension credit, other pensions include the Personal Pension, and Workplace Pension. Additionally, there are a range of benefits available for those who qualify, such as help with heating costs, free eye tests and prescriptions, and free bus passes. However, these benefits may increase or decrease. It is also important to consider other sources of income, such as savings, investments, rental income, or equity release. With careful planning, it may be possible to retire comfortably in the UK and enjoy a quality of life that you have worked hard for.
5 Ways to Save for Retirement:
1. Join a company pension. If one is not available, then a workplace pension plan is frequently provided by employers, enabling you to save money for retirement while working.
2. Start your own personal pension. Because you can set up payments straight from your bank account and receive tax relief on your contributions, personal pensions are a terrific method to save for retirement.
3. Make stocks and shares investments. As long as you do your research and choose your investments carefully, investing in stocks and shares may be a great method to save for retirement. However, the value can both increase and decrease, so it’s important to be aware of this and it may not be suitable for short-term investment.
4. Use Individual Savings Accounts (ISAs) to your advantage. Since you do not pay tax on any gains, ISAs are an excellent method to prepare for retirement.
5. The Lifetime ISA is a fantastic method to save money for retirement since you can contribute up to £4,000 a year and the Government will match 25% of your contributions. You must open a Lifetime ISA before the age of 40 and you will be unable to pay into it after the age of 50. The money also must not be taken out before you reach the age of 60 to avoid penalties.
Saving for retirement is essential in the UK for a comfortable and secure future. Start saving as soon as you can since the more you save over time, the more you will have for retirement. It is important to understand the various options for saving for retirement as well as their costs, and the benefits associated with each before choosing the one or options that are ideal for you. The tax advantages of each decision should also be considered because they may have a big impact on how much money you can save.
