Only 1 In 7 Brits On Track To Retire When They Want

Only 14% of Brits are currently “on track” to retire at their desired age with their desired income, according to new findings from savings platform Flagstone.

People aged 55 or over have an average of £146,669 built up for retirement compared to a target of £1.42m.

That means although most people want to retire at 61 years old, their current contribution levels mean they won’t be able to until 83, a gap of 22 years.

Higher earners with an income of £100,000 or more per year still face a retirement readiness gap of over 10 years.

Mind the gender pensions pay gap

Women have almost half the pension pots of men, the figures show. Average retirement savings for women stood at £78,171, compared to £141,664 held by men.

The amount of money contributed to a pension each year varied slightly too. Women contributed roughly £6,363 per year, compared to men who added £7,435 to their pension.

Generally speaking, the pension gap appears between genders due to women being more likely to take career breaks and move to part-time work, when starting a family.

Recent estimates reveal that mothers face an earnings loss of £65,618 on average over five years after having their first child, according to the Office for National Statistics (ONS). This often impacts the amount they can contribute to their pensions.

The gender pay gap also influences women’s ability to save for retirement long term.

For more information, check out our podcast episode: The Hidden Cost of Motherhood.

Are your retirement savings on track?

The amount of money you need to retire depends on how much your expenses are likely to be and how long you plan to be retired.

As a general guide, a single person needs around £13,900 per year as a minimum, £32,700 for a moderate retirement and £45,400 for a comfortable retirement.

For couples, this increases to a minimum of £22,500 a year, £32,700 for a moderate retirement and £62,700 for a comfortable retirement, according to Pensions UK.

Using a pension calculator can help you estimate roughly how much you’re likely to need.

For more tips, check out our podcast episode: The True Cost of Retirement & How to Afford It.

Nowhere near your goal, don’t panic

If you’re concerned about your retirement plans, you’re certainly not alone.

The most important thing is to review your circumstances and take action where needed.

A great place to start is estimating your retirement costs, making a plan and checking your entitlement to things like the State Pension.

We’ve rounded these simple tips and more in our guide, are you heading towards pension poverty? (and how to avoid it).

Pensions can be complex and if after doing your own research you’re still unsure, speaking with an FCA-regulated adviser could help.

They’ll take a look at your circumstances and help you create a sustainable retirement plan and get your finances on the right track.