Only 9% of working-age people are on track for a comfortable retirement and just 23% are expected to achieve a moderate standard of living, suggest new figures from Pensions UK.

The latest analysis, calculated by the Centre for Research in Social Policy, Loughborough University, suggested that around 82% of workers will reach the minimum retirement living standard, but far fewer are saving enough to achieve higher levels of financial security in later life.

The updated benchmarks show a minimum retirement lifestyle now costs £13,900 a year for a single person and £22,500 for a couple, rising to £32,700 and £45,400 respectively for a moderate lifestyle, and £45,400 and £62,700 for a comfortable retirement.

Pensions UK warned that current saving levels are falling short of public expectations and could leave many people facing a significant drop in income when they retire. The figures also exclude housing costs, which can vary widely and may increase the gap between retirement income and spending needs for some households, showing the scale of the UK's retirement living standards (RLS) challenge.

Zoe Alexander, executive director of policy and advocacy at Pensions UK, said: “Today's saving levels will not be enough for the retirement people expect. Without action, too many risk facing a cliff-edge drop in income when they stop work. The Government is right to be considering whether minimum contributions need to rise through the work of the Pensions Commission."

Professor Matt Padley, co-director of the Centre for Research in Social Policy at Loughborough University, added: We know that many people are not saving enough for retirement, but we also know that for some people it is simply impossible to save any more – you can’t save money you don’t have. By providing a living standards benchmark, the RLS can help us to think through the roles of the state, employers and individuals in ensuring everyone is able to have at least a Minimum standard of living in retirement.”

The calculations are intended as a guide for those planning their retirement savings. The findings come as the revived Pensions Commission examines whether minimum automatic enrolment contribution rates should increase. Pensions UK is also calling on employers to support higher levels of saving through enhanced pension contributions and matching schemes.

The full new state pension will rise to £241.30 a week in 2026/27, equivalent to around £12,548 a year, providing a foundation for retirement income but falling short of the minimum living standard for many households.

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