How Much Do You Need to Retire?

We all know we have to retire at some point. But how do you know if you’ll have enough money?

Living costs in retirement

Life changes when you retire - and so does how you spend your money. Whatever your plans, it's important to keep on top of things and think about the lifestyle you want.

Take a moment or two to work out a budget. That may sound daunting or just plain boring, however the better you know and plan your own finances, the more confident you'll feel about the decisions you make now.

Your personal circumstances

Everybody's circumstances are different, but the key consideration for most people when they think about retiring will come down to factors such as:

  • how much money you think you need in retirement
  • if you plan to phase your retirement by working part-time
  • if you have any debt to pay off
  • your life expectancy and health
  • how much money you've saved in pensions and other investments.

How much will you need?

Using independent research carried out by Loughborough University on behalf of the Pensions and Lifetime Savings Association, these living standards provide a benchmark level of annual income to show what life in retirement could look like for you.


As the cost of living increases, the effective value of income decreases.

However, there are steps you can take to protect any income you may be taking from your pension. Some retirement products offer some degree of protection from inflation. And you don't have to take all your pension - you can keep some invested, so that it can continue to grow.

Your pension options

State Pension

Your State Pension is also protected. It currently goes up at least 2.5% each year, or more, if prices or earnings rise by more than that. This is known as 'The Triple Lock'.

You will only be able to receive the State Pension when you reach a certain age, and if you have paid enough in National Insurance contributions.

In 2022/2023, the State Pension is £185.15 per week.

Find out more about the State Pension


If you are in debt, you should consider the impact any debt has to your retirement planning.

Using your pension to pay off debts

If you're looking to use your pension to pay off your debts it's important to make sure you've still got enough money to live on in retirement. The money you have left after tax might not be enough.

To get an idea of how much tax you might have to pay on any cash lump sum from your pension, use our tax calculator. If you're just taking tax free cash, there won't be any tax to pay.

Cash lump sum tax calculator

Plus, if you cash in all or part of your pension, then it will no longer be protected from any debt proceedings against you.

It's worthwhile looking at other possible options to pay off your debt which can be found on the Government website.

More information

You can find impartial advice on debt on these government websites:

Your Scottish Widows pension

If you have a pension with Scottish Widows already and want to put more in, visit our Individual Pensions page for more information.

Find out more

Retirement calculators

Use our calculators to give an idea of how much you’ll need for retirement.

Retirement calculators

Pension basics

Whatever stage of the retirement journey you’re at, get the basics before you go any further.

Find out more