Retirement income targets used in Australia should be adopted in the UK to help workers save for a comfortable retirement, according to a trade association.
The Pension and Lifetime Savings Association (PLSA) polled more than 1,600 savers and found just 16% knew how much money to save to achieve for an adequate retirement.
78% didn’t know how to tell if they were on track with their retirement savings, while a similar number (77%) had no idea how much they would need later in life.
The PLSA is proposing the introduction of national retirement income targets, which provide savers with income goals to identify how much they would need to save for a comfortable retirement.
In response to the proposal, those aged between 55 and 64 years old suggested a single person would need between £10,000 and £15,000 a year to achieve the minimum standard of retirement.
In addition, a person would need £15,000 to £25,000 for a modest retirement and more than £25,000 for a comfortable retirement.
Graham Vidler, director of external affairs at the PLSA, said:
“We all know we need to save for retirement but few of us know how much we might need to live on or whether we are on track to hit that target.
“The PLSA will be consulting widely to understand how the industry and government can help people build and reach a retirement plan.”