The cost of a comfortable retirement has tipped over £60,000 a year for a couple, according to benchmark pension industry figures released today.

A couple aiming for a 'moderate' lifestyle, which includes enjoying meals out and trips abroad, will now find it costs them £43,900 annually.

The moderate lifestyle is the Pension and Lifetime Savings Association's middle of the road retirement, covering the essentials plus some splashing out on food and entertainment, and running a car.

But the annual sum needed soars to £60,600 for a couple aspiring to a 'comfortable' retirement, with more holidays, theatre trips and higher motoring costs.

Individuals will need to save even harder than couples, as the moderate retirement level would cost them £31,700 and the comfortable level £43,900.

Lower energy prices have dampened the annual rise in what it costs to retire, comfortably or otherwise, according to the influential industry study of living standards.

The income needed to fund a moderate or a more luxurious lifestyle has increased only modestly, by a few percentage points since the last survey by the Pensions and Lifetime Savings Association.

Cuts in household energy bills have also led to a welcome drop in how much it takes to fund a basic retirement, which covers necessities plus some eating out and leisure activities, but no car.

The cost of a minimum lifestyle has fallen 4 per cent for a couple to £21,600 and 7 per cent for an individual to £13,400.

That means a couple could manage on two full state pensions - now £12,000 per person a year.

But a single person will need some private pension savings to get by, as will anyone who aspires to more than a basic standard of living in old age.

The PLSA's headline income figures also leave out some very important items which you will have to factor in - income tax, housing costs if you are still paying a mortgage or rent, and potentially care costs in later life.

>How much do you need to save up for the retirement YOU want? Find out below

What the retirement living standards mean and what you need to know

The PLSA's Retirement Living Standards report indicates what annual incomes people need for a minimum, moderate or comfortable retirement.

These are based on different baskets of goods and services like food and drink, transport, holidays, clothes and social outings.

The report is very useful in making people think about what kind of life they want to lead after they stop work, how much it is likely to cost and whether their current pension savings are anywhere near on track.

However, an important thing to bear in mind is that people's lifestyles change as they age.

You might want to aim for a comfortable income in the early more active stage. but only need a more basic income later in retirement.

Also, an individual needs to save up more because they will only have one state pension to rely on in old age, and couples also have greater combined purchasing power.

What do you need to save for a comfortable retirement?

The retirement living standards study shows costs now and the potential pension pot you need to meet them.

But if you are planning ahead, you need to consider the cost in the future and how much your pension will be then.

The PLSA has used annuity rates to estimate how much you need to save for the different income levels.

It has given a range to account for fluctuations in interest rates that determine price, and the different products you might buy - joint life for a couple, single life, good and poor health, for example.

What does a couple need to save for retirement? 

What does an individual need to save ?

Although annuity rates have recovered in recent years, many people now invest their pension and live on the income in retirement.

If you invest successfully, your pot can potentially keep growing to keep covering your needs, although there is a risk of running out if financial markets fall or you spend beyond your means.

People also often use property - via buy to let or equity release - savings and investing Isas and other investments and assets to fund retirement.

> How to invest your pension and live off it in retirement: A 12-step starters' guide

The retirement living standards study was compiled by the Centre for Research in Social Policy at Loughborough University on behalf of the PLSA.

The research is based on in-depth discussions with members of the public from across the country on what they expect and hope their retirement to look like - it therefore undergoes some adjustments from year to year.

This year there were some small changes in what people said they needed for minimum living costs, clothing, hairdressing, technology purchases, taxi use, and charitable giving.

Expectations of annual rail fares also jumped from £100 to £180 per person.

The PLSA notes that across all retirement living standards, weekly domestic fuel budgets have fallen by more than a quarter since its 2023/24 study.

It adds: 'This year also sees a change in how living arrangements are described.

'The terms “one-person” and “two-person” households have replaced “single” and “couple” to recognise that not everyone in retirement lives with a romantic partner – but many do share their housing and multiple living costs with someone.'