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How much is enough to retire?

It’s a tough question to answer. None of us really know how long we’ll live or what spending demands will be placed upon us during retirement, which could last many decades. Then there’s the unpredictability of financial markets which will also partly determine how our savings will grow over the years leading up to retirement.

With all that uncertainty, a target level of saving that would give you a decent standard of living in retirement would be a great thing to have. It wouldn’t make hitting your target any easier, but it would allow you to know in good time how you’re progressing and to make changes along the way to improve your chances.

With that in mind, Fidelity has worked to produce three retirement rules of thumb which can help you understand how much you’ll need to enjoy a retirement that meets your expectations.


The power of 7

Fidelity’s research found that UK households who manage to save seven times their annual household income by the age of 68 should be able to retire and maintain a similar standard of living as in their working life.

This assumes that the household will include two people, both of whom are entitled to a full state pension.

While a goal of seven may sound challenging, the key is to start as early as possible and aim to meet a series of savings milestones along the way. Our analysis suggests UK households aim to save at least one times their annual income by the age of 30 to begin their retirement journey.

Discover the power of 7

Planning your budget

Estimate your retirement spending

Calculate what your potential expenses in retirement would be.

Estimate the cost of your retirement

Calculate how much you'd need to enjoy the retirement lifestyle you want.

Helping you transition into retirement

Calculate your retirement income

Estimate what you'd receive from flexible or guaranteed income or a combination of both.

Calculate flexible income

Work out what you'd get using pension drawdown to create a flexible income and how long your money might last.

Calculate tax on withdrawals

Understand how much tax you might have to pay on the money you take from your pension and how it could affect your future retirement income.

Get a guaranteed income quote

Provide basic information about your current situation to get a quote for a guaranteed income (annuity).