Are YOU one of the 35 million savers who now have ready access to the Pensions and Lifetime Savings Association (PLSA)’s Retirement Living Standards through your pension scheme? If not, it’s simplicity itself to find out exactly what you will need to have as a retirement income in order to achieve the lifestyle you aspire to.
Launched in October 2019 – and revised in 2021 to reflect price increases and changing societal trends – the Retirement Living Standards are designed to help savers picture the lifestyle they want in retirement and understand the costs. Based on independent research with the UK public by Loughborough University, the standards cover a range of goods and services that are relevant for the majority of people across three different levels – minimum, moderate and comfortable.
For instance, a single person will need to spend about £11,000 a year to achieve the minimum living standard, £21,000 a year for moderate, and £34,000 a year for comfortable. For couples, it’s £17,000, £31,000 and £50,000, respectively. The figures will be updated again in October to reflect the changes in the prices of goods and services bought by pensioners.
Like the five-a-day healthy eating initiative, the PLSA hopes for the standards to become a rule of thumb for retirement planning and be part of a national conversation about the importance of pension saving. The latest figure of 35 million savers knowing about the standards is more than double the 14 million reported in October 2020 and indicates the PLSA is well on its way to reaching its stated adoption target of reaching 90% of active savers by 2025.
Evidence shows pension schemes are communicating the Standards to savers in a variety of ways. In a recent survey of PLSA members who have adopted the Standards, half said they feature them on their website (54%), with a third providing a link to the PLSA website (32%). A quarter say they have mentioned the Standards in their newsletters or in seminars and face-to-face events (24% respectively). They are also being communicated via online tools and calculators (16%) and in annual benefit statements (11%).
Among those who currently communicate the Retirement Living Standards to their scheme members, almost all say they are useful in helping members understand what to save for in retirement (96%), with two-thirds (66%) believing they are extremely or very useful.
You can find out more about the Standards – and use their figures as a handy starting point to inform your RetireEasy LifePlan – by clicking on the link below.