Young workers need £131 per month for comfortable retirement - Which?

'Easily achievable'

clock • 2 min read

Savers aged 20 need to put away £131 every month into a defined contribution (DC) pension to achieve a £26,000 annual income in retirement, research from Which? has said.

The figure rises to £198 for 30-year-olds, £338 for 40-year-olds, and £633 for 50-year-olds, and assumes 20% tax relief, 3% investment growth, and a state pension top-up. Saving this amount would help a retirement fund total about £370,000 after tax that could then be used to buy an index-linked joint life annuity. The research suggested a £18,000 annual income in retirement would cover household essentials, while a £26,000 income would allow spending on short-haul holidays and some leisure activities. The calculations are based on a survey of 1,590 retired couples' spending habits...

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