How much will I have to live on? It's the first question most people ask themselves when they're taking a long, hard look at the plans they have in place for their retirement.
It's hard to answer, of course – you can't accurately predict your income if it depends on how investments might perform, for instance. But it is worth trying to gain an idea of how much you might have to live on, and we can help you here.
It's important to think about the bigger picture. Income from your personal or company pension is just a part of this – albeit an important one.
Your income: you need to consider…
The state pension and other benefits
Most people would agree that it isn't easy to rely on the state pension alone.
To find out how much you could receive – as well as details on other benefits you may be eligible for – see What benefits am I entitled to when I'm retired?
Your company pension
Defined benefits (final salary) scheme
If you are in a defined benefits scheme, it will pay you an income when you retire, based on your salary and the number of years you have been a member of the scheme.
Defined contribution (money purchase) scheme
If you are in a defined contribution scheme you can view how to take money from your pension fund here.
If you're not sure what sort of pension scheme you're in, or what level of benefits you could get, you should ask your employer, or the scheme trustees.
More than one pension?
It's possible that you have other company pension plans with previous employers. See More than one pension? for further information
Your personal pension
There’s a lot to think about here. Personal pensions don’t automatically start paying you regular amounts when you retire – you can view how to take money from your pension fund here.
Other assets, savings and investments
As well as any savings or investments you might have outside your pension plan, think about any other assets you may have and how you could use them to improve your lifestyle in retirement. Your home, for instance.
If you don’t want to move, you could be eligible to use your home to fund your retirement through equity release - whilst still remaining its owner.
My Retirement Planner
This online tool is a good place to start when you want to estimate how much retirement income you may receive and how long it could last. It’s only intended to help give you a rough indication of how things are going, and whether your plans are on course.
You can use the Planner to check how varying the amount you put into your pension plan might affect your retirement income. It’s easy to use and only takes a couple of minutes.
How much will I need to spend?
Of course, the amount of money you may have coming in when you retire is only half the story. You also need to know how much your regular expenses might be.
First of all, the good news: your retirement outgoings will change as your lifestyle does, so you may not need to spend as much money as you did while you were working. For instance, you might spend less on things like travel expenses. But you’ll still have to cover the bills, of course… and you wouldn’t want to go without life’s little treats once you’ve finally got more time to enjoy them.
Use our budget calculator
Our simple budget calculator can help you work out how much you spend each month so you can see how much you need to put aside for essentials, as well as any areas where you might be able to save.
If you think you can't afford to retire…
We hope that your retirement plans are going well. But it’s also possible that you’re wondering whether you really will be able to afford the lifestyle you want in retirement. Maybe you’re even thinking that you won’t be able to retire as soon as you’d hoped.
To help you we've got some suggestions if you think you can't afford to retire.
Call us now for more information
If you’re new to Aviva
0800 285 1088
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Or if you’re already a customer
0800 158 3470
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Find out how we can help you when you call our teams
If you need some help or information from Aviva, please call us on one of the numbers above. We can help you with:
- Using our website
- All the facts about Aviva products and services
- More details on the options you can choose from when you’re making decisions about your retirement
- Information on where to find financial advice
- Although we can’t give you advice, we can put you in touch with an adviser who can talk to you about which financial products or investments may be right for you.
- Alternatively, you can visit www.unbiased.co.uk to find an adviser in your area.