Four actions to help turn your retirement hopes into a reality

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People in the UK expect to retire four years later than they actually want to. With a bit of planning, though, you could potentially leave work earlier than you might think. 

We recently found that, on average, people want to retire at 62 but think 66 is more likely to be the reality. Those who have done no planning believe they’ll need to work the longest – right up until age 70. But if you hope to wave goodbye to work sooner rather than later, these four actions could help you turn your hopes into a reality.

1. Know what you’re aiming for

Think about when you’d like to stop working and consider what you want to do in retirement. For example, some people plan to travel, pick up new hobbies, or help out loved ones financially. Once you know what you want your retirement to look like, it’s easier to understand how much money you might need.

The Retirement Living Standards website (from the Pensions and Lifetime Savings Association) shows how much money might cover different lifestyles. For example, a couple looking for a ‘moderate’ lifestyle could need £43,100 a year. That doesn’t include things like mortgages or rent, so if you think you’ll be paying either of those in retirement you’ll need to factor that in. 

2. Think about tightening up your budget

Decided you want to retire earlier? Your money will need to last longer, meaning you’ll probably need to save more than you otherwise might’ve needed to. That’s where a budget can come in handy.

Budgeting involves looking at your income and your outgoings and deciding how much money to put towards your goals. It can also help you spot areas of overspending. Could you get a better deal with, say, your TV provider, and put that extra towards retirement? 

Some people follow particular methods when saving. For instance, there’s the ‘50-30-20’ method, where you put 50% of your income towards your ‘needs’ (like food shopping), 30% towards your ‘wants’ (like dining out) and 20% towards your savings. Remember, you can change this split yourself depending on what’s right for your circumstances.

And keep in mind that an increase in income doesn’t necessarily need to lead to an increase in spending. So if you get a pay rise or find yourself with some unexpected cash (maybe thanks to a tax refund), you might decide to earmark that additional money for your retirement.

3. Choose where to put your money

There are different places you could put your money while you’re saving for retirement.

For example, lots of people use a pension plan. If you have one of these, you might not be the only one paying in – your employer usually will too. Pension plans also come with tax benefits that can help you save more. Finally, money paid into a pension plan is invested, meaning it could achieve investment growth over time. Remember, the value of investments can go down as well as up and you could get back less than was paid in.

You usually can’t start taking money from a pension plan until you’re 55, rising to 57 from 6 April 2028. If you think you’ll want to retire before then, you could also think about putting some money elsewhere – like in an Individual Savings Account (ISA), or another type of savings or investment account. Provided you’ve got enough money in it, that savings or investment account could help support you until you can take money from your pension plan. 

4. Keep an eye on how your money’s doing

It’s worth regularly checking in on your money so you can see whether you’re on the road to making your dreams a reality. For example, if you’re using a pension plan to save, you can use our pension calculator to check how much you might get from your pensions in future.

If you’ve got more than one pension plan, it’s also important to know where they all are so that you’re not missing out on money in retirement. 

Once you know where all your plans are, bringing them together can make it easier to see how much you’ve saved towards retirement. You can bring plans together by transferring them to a provider of your choosing. It isn’t right for everyone and there’s no guarantee you’ll get more as a result of transferring. Some older workplace pension plans might have valuable benefits or guarantees, so check you won’t lose these if you transfer. 

Want to find out more about finding your lost pension plans? And learn more about how you could easily bring your plans together with Standard Life? You can visit our website. 

Is retiring earlier right for you?

You don’t have to leave work completely; you might prefer to cut down your hours instead. 

And remember, you usually need 35 ‘qualifying years’ on your National Insurance record to be entitled to the full State Pension. People normally get these years by working or getting particular benefits. So check that stopping work earlier won’t impact how much State Pension you get. Learn more about the State Pension in our article.

Changing the retirement date on your pension plan can impact your pension investments.

Retiring is a big decision, so you may want to get financial advice from a financial adviser first. Find out more about this on MoneyHelper.

 

The information here is based on our understanding in February 2025 and shouldn’t be taken as financial advice.

Pensions and some types of ISAs are investments. Their value can go down as well as up and could be worth less than was paid in.

Your own personal circumstances, including where you live in the UK will have an impact on the tax you pay. Laws and tax rules may change in the future.

Standard Life accepts no responsibility for information in external websites. These are provided for general information.