Martin Lewis shares simple way to work out how much money to save every year for retirement

dailyrecord.co.uk:

The focus on pensions has ramped up over recent weeks following reports that the State Pension age could be rising to 68 earlier than planned, effectively meaning that everyone currently aged 54 and under will need to work longer.

People with private or workplace pensions will also have to wait until they are 57 to access retirement savings due to changes coming into effect in 2028.Pensions, savings and retirement are frequent topics on The Martin Lewis Money Show Live and this week the consumer champion shared a very quick way to work out how much you should be saving each year to make sure your pension pot is brimming over in later life.

While his method is just a ‘rule of thumb’ it’s a good benchmark for those who haven’t started saving yet, or are swithering about opting out of auto-enrolment.Martin explained that all you have to do is take your age, halve it and that is the percentage of your annual income you should be putting into your pension every year until you retire.An example of this is someone who is 30 would need to save 15 per cent of their annual income every year.

If they earned £30,000, they would need to put away £4,500 each year, the equivalent of £375 each month.Martin told viewers most people don’t do that, but you have to take into account your workplace pension and the contribution towards your pension made by your employer.You can catch up with The Martin Lewis Money Show Live on the STV Player.