News updates

Pensions UK has updated its Retirement Living Standards – a set of benchmarks showing how much different retirement lifestyles cost in the UK, based on real household spending – to help highlight the growing cost of retirement for today’s pension savers.

The updated Retirement Living Standards show the cost of three different lifestyles:

• Minimum – around £13,900 a year for a one-person household and £22,500 for two people – covering basic needs
• Moderate – around £32,700 for one person and £45,400 for two – offering more security and flexibility
• Comfortable – around £45,400 for one person and £62,700 for two – allowing for more choice, travel and leisure
  

Rising costs for everyday essentials, such as food, bills and transport, mean the price of retirement is increasing.

And while many people (82%) may reach a basic level of income in later life, far fewer are on track to achieve a moderate (23%) or more comfortable (9%) standard.

The retirement you want may depend on the choices you make today

Many people could face a drop in income –and lifestyle – when they stop working, unless they act quickly.

It's important to dedicate some time to planning ahead. The Retirement Living Standards provide a useful guideline for lifestyle costs but your costs, and priorities, as an individual may look very different.

Simple steps to check where you stand:

1. Work out what your lifestyle might cost

   Use the Retirement Budgeting Calculator to build a picture of what your lifestyle might cost.

    It can help you:

   • Think through your day-to-day expenses
   • Factor in the things you enjoy
   • Consider any needs you have as an individual
   • Get a clear, realistic plan of the income you should aim for 
   
   
2. Check what your pension could provide

   Once you know what you might need, it’s important to see how your pension compares.

    You can:

   • Request an estimate of your retirement benefits from the Scheme
   • Use the Pension Planner (for active defined benefit members)
   • Use the DC Retirement Modeller (for members of the Industry-Wide Defined Contribution Section)
   
   

   These tools are all available when you log into your myRPS account. They can help you understand what you’re on course to receive from your railways pension and whether there might be a gap.

   You should also factor in any other sources of income you expect to have when you retire, such as the State Pension or income from other pensions or savings arrangements.

3. Act, if there’s a gap between your expected income and the costs you might face

The good news is that even small steps can make a difference over time.

If you can, you might consider paying into Additional Voluntary Contributions (AVCs) or increasing your AVCs if you already make them. Saving a little more now could really help to boost your income later and give you more options in retirement.

Don’t let your opportunity pass

In a recent survey, nearly two-thirds of Railways Pension Scheme members said they would tell their younger selves to save more into their pension.

The earlier you start – and the more you can save – the better prepared you’re likely to be.