How much do I need to save to retire at 50?

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For customers

For some people retirement seems a long way off and they haven’t even thought about it – but there are also plenty of others who dream about retiring early. If you can afford it, retiring while you're still relatively young could allow you to enjoy life free of work before facing the challenges of aging.

However, it can be tricky to determine how much money you need to save before taking the leap into early retirement. The right amount is different for each individual and working it out it requires some careful planning. Start by answering these five questions to determine how much you’ll need to save to retire at 50.

1. What retirement lifestyle do I want?

Before we start talking about finances, thinking about what you’d like to do during your retirement can help clarify how much money you’ll need. Retirement can seem like an exciting prospect as you don’t need to go to work, but often people end up with more time on their hands than they first anticipated.

We all have different retirement lifestyles in mind. You might be comfortable living a bit more frugally, want to travel – or maybe you don’t want to stop working and would prefer to start your own business. Striving towards what you want, and putting savings away to try achieve this, is a good starting point and motivator.

2. How much will I need to live on each year?

It will depend on the retirement lifestyle you want to live – but to help provide some direction, you could try the ‘50-70 rule’. It suggests that you should aim for a total retirement savings pot that allows you to have an annual income of between 50-70% of your pre-retirement income1. So, if you’re used to living on £40,000 a year, you might need a retirement income of roughly £20,000 to £28,000.

However, the rule doesn’t work for everyone. For example, if you expect to be paying rent and have a car payment, you’ll likely need more income than someone who has a mortgage paid off and doesn’t drive. So, in addition to using the 50-70 rule as a guide, take time to calculate your basic annual expenses. Also, be sure to include any special things you'll want to buy or do during retirement, such as travel or golf.

3. How much can you depend on your pension?

Retiring at 50 would require funds to cover you until you can access your pension. Most pension schemes won't allow withdrawals until you reach at least age 55 – and this is  expected to rise to 57 by 2028.

If you plan to retire before 55 (or 57 depending on your current age), you'll need to determine where you'll get income from during that period. Depending on your personal situation – you’ll probably need significant savings or income from other investments to tide you over. Remember, the value of an investment, and any income you take from it can fall as well as rise, isn’t guaranteed and you could get back less than you invest.

It's important to remember when you’re starting your savings journey – say if you’re in your 20s or early 30s – to plan for the fact that the minimum pension age to access your private pension could change again in the future. So you’ll need to save enough to live on beyond the age of 57.

Also, remember to include your State Pension entitlement. For more information about how the State Pension fits into this, read our article ‘How much State Pension will you get and when?’.

If you're in any doubt about investing, we recommend you speak to a financial adviser who can help find the best solution for you. You can find a financial adviser through the Money Advice Service. A financial adviser is likely to charge for their service and should provide details of their charges upfront.

Don’t forget about your workplace pension

Under auto-enrolment your employer may be making contributions to your workplace pension too. Generally, employees need to put in at least 5% of their annual salary and their employer must add a minimum of 3% on top of that2 – but each organisation will have their own contribution structure for their workplace pension so make sure to check this out. Trying to increase your pension contributions too when you can, can help build a healthy retirement pot.

Our Financial Wellbeing Index can help you work out how much you should be contributing to your pension – check out the long-term savings section.

4. Can you delay taking pension payments?

Even if you’re eligible to withdraw funds from your pension at age 55 (or 57 depending on the normal minimum pension age at that time), delaying those withdrawals will give your pension pot more time to grow. For example, you could work to save enough money to avoid taking pension payments until age 65 or later, to preserve your pension pot and ensure that it will last longer in retirement.

The value of an investment can fall as well as rise and isn’t guaranteed. The final value of your pension pot when you come to take benefits may be less than has been paid in.

5. How many years do you expect to be retired?

There are no guarantees for how long any of us will live, but for retirement planning purposes, you’ll have to make an informed guess. Find out the average life expectancy for a person of your gender in your geographic region. Also, consider your family history. For example, if you expect to live to the age of 85 and you plan to retire at 50, you’ll need to save enough to support yourself for 35 years in retirement.

When you have a general idea of how many years you might expect to live, you can calculate how many years you’ll need to plan for in retirement. There are plenty of online retirement calculators available.


Once you’ve answered these five questions, you should be able to develop a better idea for how much you’ll need to retire at 50 – or any age. Even if retirement seems a long way off for you, it’s never too early to start thinking and saving towards it. The earlier you start the better. The key is to understand that your retirement will look different from someone else’s retirement, and the amount you need to save will depend on your specific situation and expectations.

Remember, financial advisers are highly qualified professionals who can help coach you towards achieving your financial goals and keep you accountable. If you don’t already have a financial adviser, you can find one near you by visiting the Money Advice Service.  


For more articles like this visit our Customer Perspectives hub.



1How much should I pay into my pension? Data source, Nick Green,, December 2020.

2Workplace pensions. Data source, Gov.UK, April, 2021.