How much do I need to retire?
There's no single magic number — but there are simple rules that get you close. In this guide we'll walk through the three most common approaches financial planners use, show you how to estimate your own target, and explain why the answer depends as much on your spending as your salary.
Start with what you'll spend, not what you earn
The biggest mistake people make when estimating their retirement number is anchoring on their current salary. What actually matters is your annual spending in retirement. Salary stops; spending continues.
Add up your essentials (housing, food, utilities, healthcare, insurance), then layer in lifestyle costs (travel, hobbies, gifts, dining out). Many planners use 70% of pre-retirement income as a default, but your number could be 50% or 110% — it depends on your mortgage, children, and how you want to live.
Rule 1: The 25x rule
Multiply your expected annual retirement spending by 25. That's your target portfolio. It comes from the 4% safe-withdrawal rule — withdrawing 4% of a balanced portfolio each year has historically lasted at least 30 years.
- Spend £40,000/yr → target £1,000,000
- Spend £60,000/yr → target £1,500,000
- Spend £80,000/yr → target £2,000,000
Rule 2: Salary multipliers by age
Fidelity's widely-cited benchmarks suggest you should have saved a multiple of your salary by each decade:
- By age 30: 1× salary
- By age 40: 3× salary
- By age 50: 6× salary
- By age 60: 8× salary
- By age 67: 10× salary
These are useful checkpoints to see whether you're on track — not a personalised plan.
Rule 3: Work backwards from your desired income
If you want £5,000/month in retirement income, you need roughly £1,500,000 invested (because £1,500,000 × 4% ÷ 12 = £5,000). The strength of this approach is that it converts a scary lump sum into a tangible lifestyle.
Don't forget inflation
£1,000,000 in 30 years won't buy what £1,000,000 buys today. At 2.5% inflation, prices roughly double every 28 years. Our calculator shows both the nominal (future) and inflation-adjusted (today's money) projections so you can see the real picture.
Putting it all together
Three rules, one goal: a clear retirement target. Plug your numbers into the RetireSmart calculator and you'll see exactly how much you'll have at retirement, and what monthly income that supports.
Frequently asked questions
Is 1 million enough to retire?▾
For many households, yes — using the 4% rule, 1 million in savings supports roughly 40,000 a year in pre-tax income. Whether that's comfortable depends on your spending, your other income sources (like State Pension or Social Security), and where you live.
How much do I need to retire at 60?▾
A common benchmark is 8x your final salary saved by age 60. Someone earning 80,000 would target around 640,000. Use our calculator to test scenarios based on your own contributions and expected returns.
What's the 70% rule for retirement?▾
It assumes you'll need roughly 70% of your pre-retirement income each year to maintain your lifestyle. Some retirees need more (active travel years), some need less (mortgage paid off, lower taxes).
Does this include State Pension or Social Security?▾
No — our calculator estimates your private savings only. Add expected State Pension, Social Security, workplace pension, or rental income on top when working out your true retirement income.