London, 3 June, 2026: New research from Pensions UK has laid bare the scale of the UK’s retirement savings crisis, with updated Retirement Living Standards showing that only 9% of the working population are on track for a comfortable retirement and just 23% are on track to reach a moderate standard of living.
The annual standards, calculated by the Centre for Research in Social Policy at Loughborough University, show that a comfortable retirement now costs £45,400 a year for a single person and £62,700 for a two-person household (with shared expenses). A moderate lifestyle requires £32,700 and £45,400 respectively, while a minimum standard, described as a baseline of essentials and limited social activity, requires £13,900 for a single person and £22,500 for a couple.
These standards assume home-ownership with no mortgage, so depending on individual circumstances, mortgage costs, rent or social care costs may need to be factored in, as well as any income tax due on your pension.
Maike Currie, VP Personal Finance at PensionBee, comments:“The cost of retirement has risen by around 3-4% across all Retirement Living Standards, broadly in line with the inflationary backdrop, reinforcing the challenge facing savers. While the increases may appear modest, the bigger headline issue is that too many people are still not saving enough to achieve the retirement lifestyle they expect.”
PensionBee’s recent research on the streets of Manchester highlighted just how much the general public underestimates the amount they need in their pension to retire comfortably. Many were stunned that to achieve a comfortable retirement, you need in excess of £1 million in your pension pot. Watch the full video here.
While Pensions UK estimates that around 82% of the working population will reach the minimum standard, the figures drop sharply above that threshold. Only around one in four workers are on course to reach a moderate living standard, and fewer than one in ten are on track for a comfortable retirement.
Crucially, the figures do not include housing costs, which vary significantly and could leave many retirees facing shortfalls considerably larger than the standards suggest.
Maike Currie, VP Personal Finance at PensionBee, said: “These figures are a wake-up call. Automatic enrolment has been hugely successful in getting people saving, but participation and adequacy are not the same thing. The current minimum contribution rates were never intended to be the end goal.
“We also need to bring more people into the system that are presently excluded, such as the self-employed, carers, lower earners and those juggling multiple jobs. Retirement adequacy is not just a savings challenge, it's an inclusion challenge too.
“People can't save money they don't have, which is why this cannot be left solely to individual behaviour. Only 9% of people are on track for a comfortable retirement, and nearly four in five will fall short of even a moderate standard of living. This represents a systemic problem that has been building for years.
“More concerning, the standards do not include housing costs, and so very likely underestimate the true reality. For the millions of people who will still be renting in retirement, or have mortgage debt later in life, the real shortfall is likely to be considerably larger than these figures suggest.”
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