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New flat rate pension not enough

From flat rate to flatline. A survey by Standard Life has found that 60 percent of people believe that £140, the proposed rate for the new state pension, is just not enough to live on. The Joseph Rowntree Foundation has calculated that the minimum a person neeeds to lead an 'acceptable' life is £200.

To compensate for the shortfall, a little tightening of the belts will be required for those who are working. Many think that by setting aside just 5 percent of their income, a decent standard of living in retirement can be acquired. Think again. A rough rule of thumb is that pension contributions should go up as you get older, and a good idea to calculate how much that should be is to halve your age. So a thirty year old needs to be squirreling away 15 percent.

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