State pensioners living on their own sent £500 warning | Personal Finance | Finance

That amount of money is the extra sum needed to have a good standard of living in retirement, as costs have risen significantly in the last year.

The net income required for a single person to have a minimum standard of living has increased from £13,400 to £13,900 (a 3.7 per cent rise).

The ‘minimum’ standard of living assumes someone would spend £55 on groceries a week, have no car, and can afford to take one week-long UK holiday per year, among other needs.

The hike over the last year reflect the increased costs for households according to Pensions UK.

These include food, essential household bills, transport, social activities, and hobbies.

According to Pensions UK, a single person with a full state pension would still need at least £335,000 in a money purchase (defined contribution) pension to be able to achieve a net annual income (from an annuity) of £31,700 in retirement.

This would mean that a pensioner could live moderately. Defined as spending £56 a week on groceries, running a small car replaced every seven years, and taking a three-star, two-week foreign holiday, plus one long weekend break in the UK per year.

A couple would need an annual net income of £22,500 to live a minimum lifestyle, a 4.2 per cent increase from 2025’s £21,600.

The rise is concerning as Pensions UK’s research suggests that the majority of the UK’s working population will fall short at meeting the savings required to even have a moderate standard of living in old age.

Claire Trott, Head of Advice at St. James’s Place says: “The increases across the board of the UK Retirement Living Standards isn’t a surprise because of the ongoing cost of living increases. It does remind us that retirement planning isn’t a ‘once and done’ thing and needs an annual review at a minimum. This helps savers check their progress and amend their plans accordingly.

“Having a financial plan can really help. Seven out of 10 people from our 2026 Financial Health Report said that a plan made them feel more confident in their financial position.”