Retirees trying to achieve a basic standard of living will have seen their expenditure increase over the last year due to high inflation.

The Pensions and Lifetime Savings Association has developed Retirement Living Standards based on three different levels, Minimum, Moderate and Comfortable, to help us picture what kind of lifestyle we could have in retirement. You can read all about these standards at retirementlivingstandards.org.uk

The latest inflation update of standards has shown that people on the minimum level have seen the biggest percentage increase to the cost of their retirement, owing to the higher proportion of their budget going towards the things that have risen the most in price: food and energy.

The disproportionate increase in the cost of retirement for those on the minimum level means the government’s commitment to the State Pension triple lock, is especially important. Rising by a record 10.1% to £10,600 per year, a couple who are each in receipt of a full new state pension would reach the minimum standard level. This level should also be very achievable for a single person if they supplement the state pension with income from a workplace pension saved through automatic enrolment during their working life.

Changes to the Retirement Living Standards over the past year and required pot sizes

The Retirement Living Standards are regularly reviewed to make sure they keep up with changes in the public’s expectations of what retired households need, as well as the changes to prices on the shelves, to remain relevant to real world retirement spending.