According to government figures and warnings from Rachael Bell, practice principal at Rachael Bell Wealth Management, around 15 million people are currently under-saving for retirement.
Ms Bell said: “Fewer than 40 per cent of us are on track for even a moderate standard of living in retirement.
“This ranges from those earning the minimum wage to high earners who are not aware of how much they will need in retirement.”
Bell warns that the minimum required by auto-enrolment often falls short of what is needed for a comfortable retirement.
Calculations suggest that a comfortable lifestyle in retirement—one that includes an annual holiday, meals out, and a new car every five years—now requires more than £43,000 per year for a couple and over £31,000 for a single person.
The average private pension pot in the UK is just £107,000, a sum that Ms Bell warns would not generate even half the annual income needed for such a lifestyle.
Ms Bell advises people to start planning early, saying that delaying action can have serious consequences.
She said: “Don’t wait for retirement to creep up on you.
“Like every good business decision, the best outcomes come from proactive, intentional planning.”
She has outlined a five-point plan for improving pension health.
First, individuals should start saving as early as possible to take advantage of compound growth over time.
Second, Ms Bell recommends making regular and increasing pension contributions, particularly when earnings rise.
Third, investments should be aligned with the individual’s retirement timescale—higher-growth, higher-risk investments may be appropriate earlier in life, while lower-risk options could become important closer to retirement age.
Fourth, Ms Bell says realistic planning is essential.
She encourages people to estimate their retirement income needs, taking into account life expectancy and inflation, and to review their pension plans annually, adjusting contributions and investment strategies as necessary.
Finally, Ms Bell recommends seeking professional advice to help “avoid costly mistakes that could impact your long-term financial security.”
Ms Bell said: “The figures do not lie, and whilst some have a plan in place and are making the requisite contributions to achieve it, millions are not in that position.
“It’s essential more people start to look beyond the near horizon – and plan for the future they want.”
Recent data from The Pensions Commission shows that 45 per cent of working-age adults in the UK are not contributing to a pension at all.
Even among those who are saving, many rely solely on the legal minimum, which may not be enough for a comfortable retirement.
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