First, some numbers…
For a comfortable retirement, you would typically need an annual income of around £60,600 as a couple and £43,900 as an individual¹. Other research suggests a total pension pot of £270,000 to £400,000 each for couples, or £540,000 to £800,000 for an individual is needed, alongside the full State Pension².
According to the latest data, the average pension pot for people aged 55 to 64 in the UK is around £137,800² – a significant increase on earlier stages of life, but often still short of what many envision for a comfortable retirement. That figure includes private pension savings but excludes the State Pension, which most people will also receive alongside their private funds.
However, averages only tell part of the story. Many households hold savings outside pensions, in ISAs or property, while others rely more heavily on defined benefit schemes or workplace arrangements. What matters most is having clarity on your position and planning around your own goals.
Shifting focus from saving to using your savings
At this point, your pension pot is something you’re increasingly thinking about in terms of how to use it, not just grow it. For some, that might mean planning the timing of withdrawals to manage tax efficiently or to maximise income. For others, it will be about understanding the interplay between your private pension and the State Pension so you can structure your income in retirement without unnecessary tax inefficiency.
It’s worth remembering that pension values typically peak around State Pension age before people start to draw them down and that’s a natural part of the retirement lifecycle. Having a strategy in place for decumulation helps reduce the risk of running short and gives you confidence that your income will be there for the long term.
Planning for longer life expectancy
With people living longer on average, retirement can span decades. Your pension and other savings need to support you through these years and planning for longevity is essential. That might mean adjusting how you draw down income, rebalancing investment risk, or ensuring you have access to cash when you need it, without compromising long-term growth.
Your Finli planner can help you build a plan that balances these needs, managing risk while keeping your money working for you.
Inheritance planning comes into sharper focus
For many approaching retirement, a priority shift includes thinking beyond day-to-day needs to legacy. With Inheritance Tax (IHT) thresholds frozen, more estates could fall into IHT scope over time. Planning ahead needn’t be complicated, but simple steps like making use of annual gifting allowances, understanding the seven-year rule and keeping beneficiary nominations up to date can all reduce future stress for your loved ones.
Estate planning can be one of the most reassuring parts of later life planning – helping ensure your wealth passes on in the way you intend, with clarity and purpose.
Seeing the whole picture
Money doesn’t exist in isolation. Open conversations with loved ones about your plans, your priorities and what matters to you can strengthen understanding and shared confidence.
A calm, confident transition
Approaching retirement doesn’t need to be stressful. It can be one of the most empowering stages of your financial journey, where clarity and intention bring peace of mind. With thoughtful planning – which includes considering decumulation, tax efficiency and legacy – you can enter retirement with confidence, knowing your finances support both your present lifestyle and your future goals.
The value of investments can go down as well as up and you may not get back the full amount you invested. The past is not a guide to future performance and past performance may not necessarily be repeated. The Financial Conduct Authority (FCA) does not regulate Will writing, tax and trust advice and certain forms of estate planning.