What is a good pension pot at 55?

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A good pension goes hand in hand with a comfortable retirement. You want to have a secure future and control over your finances. 

A good rule of thumb is to save ten times your average salary. If your average salary throughout your career was £40,000, you should plan to save £400,000 for your retirement. 

However, the “perfect pension” depends on an individual’s circumstances, living costs and the age they want to retire. The ideal pension pot is subjective as some can live with less while others need a higher monthly income. A good pension pot at 55 may look different for each individual.

Along with a good pension, you also need a good retirement plan.

Saving is the easy part, while planning your retirement can be tricky. You need to carefully consider how you’ll save and hit your financial goals. With careful planning, you can efficiently save for your pension and have peace of mind that you have life savings for your retirement.    

Let’s see how you could achieve both a good pension and an effective retirement plan. 

For your reference, in this guide ‘pension pot’ refers to your multiple pensions as one entity. 


How much do you need to save for your retirement at 55?

When it comes to the perfect pension pot at 55, think of your lifestyle, your basic expenses and how you will be spending your pension and retirement wealth once you decide to retire. This will give you an estimate of how much you need to save for your retirement. 

The perfect pension pot is subjective and unique for each person; some could comfortably live with £25,000 per year while others might find it difficult. The best option for you is to get advice from a financial advisor, whose expert opinion can help put a solid retirement plan in place for you.

Opinions on saving for a comfortable retirement vary. Here we’re exploring three options that you can discuss with your financial advisor.

Option 1:

Advisers often recommend saving up to ten times your average working salary by the time you retire. For example, if your career average salary is £35,000, you should aim to save £350,000 for your retirement.

Option 2:

Others recommend saving 12% of your salary every month. For example, if your annual salary is £35,000, you would have to save £350 every month. With 4% growth, your pot could be worth £230,000 by the time you’re 55 and £314,000 at 65. 

Option 3:

Some follow the 50-70% rule. If you retire with a £50,000 annual salary, you would need 50% or 70% of it as retirement income per year, depending on your lifestyle and living expenses. For example, 50% of a £50,000 annual salary is £25,000. This would be your pension income annually until you die. Assuming that you retire at 55 and draw a pension for 20 years, you would potentially need to save £500,000 in your retirement pot. 

However, please remember that in all of the scenarios above, inflation can erode the value of your pension pot over time, and you may need to save more than the amounts suggested.


Having a solid pension plan and budget in place will help you be fully aware of where your money will go, how much you should save and have full control of your finances. Also, consult a financial advisor for trusted advice and help with your retirement plan before you decide how to save for your retirement. 


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Planning for your retirement: what you need to know.

Planning for your retirement is the most important step when it comes to saving enough for a good pension pot. You are also better prepared for the future and in control of your finances. 

Before we explore how you could efficiently save for your retirement and build your ideal pension pot at 55, it is important that you consider the following: 


How your income needs might change over time.

The lifestyle you have now and the expenses you have might not be the same in your retirement. You might decide that you need a higher income in retirement for travelling, or that you could live comfortably with less. 

Determining your future living expenses and circumstances will help you accurately calculate and plan your ideal pension pot. It will help you achieve your ideal savings goal.

Ask yourself:

Will you spend the same amount you are spending now during your retirement?

Will you maintain the same lifestyle you have now?

What is an ideal monthly income for you?

When planning your retirement, consider your future income needs and how these might change. Think about how you want to live and how much you would be spending. Then set realistic targets. 



The age you start saving for a pension as well as the age you decide to retire influences your retirement plan.

The age you start saving is important for your retirement plan. When you start saving early in a pension scheme, compound interest will help you achieve your savings goals much faster. It's earning interest on interest itself, which is added to the overall amount. This means that the earlier you start saving the better chances you have of saving enough by the time you’re 55.  

Also, deferring taking your pension could help you save more. The earliest you can currently withdraw your pension is at 55. Withdrawing your pension later could grow the size of your pot because you continue to save for your pension. Therefore, the age you decide to retire can help you save more for your retirement.  

Consult a financial advisor for a professional and reliable opinion.


Consider a plan B in case you don't hit your target.

You’ve decided to retire at 55 but the amount you've saved in your pension is not enough to last for 25 years. This is where your plan B helps, adding security to your financial plan.

If you haven't managed to save as much as you’ve planned, you need to consider your alternative options. You have the option of:

  • Deferring your pension and continuing work for a few more years. 
  • Withdrawing your pension as extra income while maintaining a working life.
  • There may be benefits you could be eligible for that could help you financially. 
  • Consider other sources of income such as property, investments or your own business. 

Speak to a financial advisor about your retirement options and the income you'd like to have in the future. They are professionals who can advise you on the best plan of action for your future pension. Alternatively, you can visit the UK Government’s Pension Wise service.


Important life changes that might inhibit your pension contributions.

Important life changes could put a pause on your pension saving journey. For example, a mortgage, childcare or marriage, all need temporary financial support, driving people to stop their pension contributions in order to save for these needs. But if you’ve planned to accommodate these changes in your pension journey, you have more confidence that you’ll save enough. 

These life transitions are part of life. It is important that you plan ahead for most life circumstances that may need your financial support. This way you don’t shouldn’t have to postpone your pension savings. 


During your retirement planning, think carefully of about your future expenses and income needs, as well as the age you’ll start saving and retiring. You want to be well-prepared and secure for the time you decide to stop working. A plan B in place is a safety net for your future as several important life changes could hinder your pension saving progress. 

A financial advisor or pensions expert could always advise you on best practices and saving habits that can help you save for a good pension pot. 

Give yourself the pension plan you deserve. 



Let Raindrop assist you in your pension journey

Here at Raindrop, we strive to make pensions simple and easy to understand. Our expertise is all about encouraging confidence in setting up a retirement pot - or even better, finding your existing ones. 

Our smart pension tracing technology finds all your lost pensions from various workplaces, with the ability to transfer and combine them in one online place! Take control of your pensions with our help.

Start your retirement journey here. Please note that if you chose to combine your pensions into a new Raindrop pension, or you open a new pension with Raindrop, as with all investments, your capital is at risk as with all investments and the value of your pension savings can go down as well as up.

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If you are considering finding and combining your pensions into one place then Raindrop could be a good solution for you. If you choose to combine your pensions with Raindrop, as with all investments your capital is at risk. The value of your pension can go up as well as down.

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