How do you use the Retirement Living Standards to set an income target?
The Retirement Living Standards give three annual income levels for a single person and for a couple, built from what people actually said they needed rather than from a replacement-rate rule. They are the most useful starting point available in the UK, and they carry one assumption that changes everything: no mortgage and no rent.
- Single person: Minimum £13,900, Moderate £32,700, Comfortable £45,400 a year.
- Couple: Minimum £22,500, Moderate £45,400, Comfortable £62,700 a year.
- The assumption: the figures assume you own your home outright, with no mortgage or rent.
- The tell: two full State Pensions already exceed the Minimum level for a couple.
01 What the three levels describe
The standards were built by asking groups of people what goods and services a household needs for each level of living, then costing the basket. Minimum covers essentials with limited room for anything else. Moderate adds more financial security and flexibility — a car, a two-week holiday, occasional meals out. Comfortable adds more discretion and better replacement cycles.
For a single person the levels are £13,900, £32,700 and £45,400 a year. For a couple they are £22,500, £45,400 and £62,700. The couple figures are not double the single ones, which reflects the household costs that do not scale with people.
The gap between Minimum and Moderate is the largest step, and it is where most planning attention belongs. It is the difference between covering essentials and having a life with options in it.
Source: Retirement Living Standards
02 The assumption that changes everything
The figures assume you own your home outright with no mortgage and no rent. That is the single most important thing about them, and it is why using them without adjustment produces a target that is far too low for anyone who will still be paying for housing.
A retiree with £9,000 a year of rent needs the Moderate figure plus £9,000, not the Moderate figure. Someone with five years of mortgage payments left needs a plan with a step down in it rather than a flat number.
Two other adjustments apply. The published figures are for outside London, where costs run higher, and they are pre-tax in the sense that the income has to be enough after tax — a Moderate income drawn from a pension needs to be higher than the target to net down to it.
Source: Retirement Living Standards
03 Where the State Pension gets you
A couple with two full new State Pensions receives about £25,100 a year, which already exceeds the Minimum standard of £22,500. That is a genuinely useful fact and it is not widely known: for a couple who own their home outright, the State Pension alone covers the Minimum basket.
A single person with a full new State Pension receives about £12,548, which is short of the Minimum standard of £13,900 by around £1,350 a year. The gap is small and it is real, and it is one of the reasons a complete National Insurance record matters more for single people.
From there the arithmetic is straightforward: the gap between the standard you are aiming at and your guaranteed income is what private savings have to produce, and that number is what sets the pot you need.
Shows: the annual income your savings have to produce to reach a chosen standard, after guaranteed income and housing costs. Ignores: tax, inflation, and any change in spending as you age.
On the defaults above, the worked example shows £20,152 a year. Savings have to produce £20,152 a year, which at a 3.5% withdrawal rate needs a pot of about £575,771.
Source: The new State Pension
These are the best numbers available and they come with a footnote most people never read: they assume you own your home outright. Add your actual housing cost before using any of them, because a Moderate income with nine thousand pounds of rent to pay is not a Moderate life. The other thing worth knowing is that two full State Pensions already clear the Minimum standard for a couple who own their home. That is a much better starting position than most people think they are in, and it reframes the question from 'can I afford to retire' to 'what does Moderate cost me'.
FAQ
Do the standards include housing costs?
No. They assume you own your home outright with no mortgage or rent, so anyone still paying for housing has to add that cost on top. It is the most important caveat attached to the figures.
Are these figures before or after tax?
They describe what the household spends, so the income needed to reach them has to be enough after tax. A Moderate lifestyle funded from taxable pension income requires a gross figure somewhat higher than the published number.
Does the State Pension get me to any of them?
For a couple who own their home, two full new State Pensions of about £25,100 already exceed the Minimum standard of £22,500. A single person with a full State Pension falls around £1,350 short of the single Minimum figure.
Sources
Regulator references
- Retirement Living Standards · Pensions and Lifetime Savings Association · 2025The minimum, moderate and comfortable income benchmarks used as the target.Last verified: 2026-09-07
- The new State Pension · GOV.UK · 2025Sets the qualifying-year rules and the full new State Pension rate this post works from.Last verified: 2026-09-07
Calculator unit tests · the assertions this page's worked example is checked against, and their last result
Changelog
- 2026-09-07 — initial publish (new format)
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Jordan Reeves
Founder of Talk Through Wealth. A software engineer for over a decade before turning to retirement planning, Jordan built the projection engine after watching family members get fragmented, country-by-country advice that never reconciled. He writes about retirement the way the engine computes it: month-by-month, lifetime-long, and skeptical of any rule of thumb that hasn't been run through the math.