High Net Worth Individuals Underestimating How Much Money They Need for a Comfortable Retirement by as Much as £950k
11 June 2025
Saltus’ new Pension Calculator uncovers worrying gaps in retirement savings
- Individuals with assets of more than £250,000 think they’ll need a pension pot of £663,308 to achieve a ‘comfortable retirement’
- Saltus’ new Pension Calculator shows that in reality, retirement savings of at least £1.5 million are needed – more than double the average estimate and triple the amount respondents currently have put away
- Despite needing to boost their retirement savings, just 7% contributed the full £60,000 allowance last year, while 1 in 4 contributed less than £10,000
High net worth-individuals (HNWIs) in the UK are significantly underestimating how much money they need for the retirement they want, according to the latest figures from the Saltus Wealth Index and insights from the new Saltus Pension Calculator.
Saltus surveyed 2,000 UK adults with more than £250,000 in assets and asked how much they believe they’ll need in their pension pot to retire comfortably – which according to the Pension and Lifetime Savings Association (PLSA) – needs to provide an annual income of £43,900.
One in five (18%) believe they would need an individual pension pot of between £401,000 and £600,000 for a comfortable retirement, while 13% believe they would only need between £201,000 and £400,000. On average, respondents believe a pot of £663,308 would be sufficient for a comfortable retirement. However, the Saltus Pension Calculator reveals that, once inflation is taken into account a pot of at least £1.5million is needed, increasing to £2.5 million for younger respondents.
And the difference between what HNWIs actually have in their pensions pots and what they need is even bigger, with shortfalls of between £250,000 and £950,000 depending on their age. Even when the state pension is taken into account, those aged 54 and over still fall short.
Currently, the average pension pot amongst respondents is around half a million pounds (£520,052), while annual contributions are around £30,000 Based on a cautious 4% annual investment return, that means most HNWIs will fall significantly short if they want to retire at 67 on an income of £44,000 per year (adjusted for inflation), as the table below shows*:
| Age | Mean pension pot | Mean annual contributions | Annual investment return (cautious) | Total forecasted pension pot | Total amount required for someone wanting to retire at 67 on £44k per year | Shortfall for someone wanting to retire at 67 on £44k per year | Shortfall when state pension* is taken into account (retiring at 67 on £32,027k (£44k -£11,973) |
| 44 | £498,276 | £35,105 | 4% | £ 2,269,286 | £ 2,562,215 | £ 292,929 |
|
| 54 | £532,906 | £30,239 | 4% | £1,263,302 | £2,001,598 | £738,296 | £193,634 |
| 64 | £518,119 | £17,025 | 4% | £611,618 | £1,563,645 | £952,027 | £526,538 |
Table uses data from the Wealth Index on average pension pots and contributions at ages 44, 54 and 64
Just 8% are using their full allowance while 12% are already raiding their shrinking pension pots
Despite growing awareness around the need to save for retirement, the Saltus Wealth Index Report shows that only a small proportion (8%) are contributing the maximum £60,000 allowed in pensions savings per year. While average planned contributions are gradually rising – from £28,198 last year to £30,018 for the year ahead – the rate of saving continues to lag behind what’s needed to meet retirement expectations.
Furthermore, one in eight (12%) of the 73% HNWIs who are providing regular financial support to adult children or grandchildren are funding this support by either dipping into their pension pots or reducing their contributions.
To support better long term planning, Saltus has launched a new Pension Calculator, available to anyone for free, designed to help individuals assess whether they are on track to achieve their desired retirement income.
Mike Stimpson, Partner at Saltus, said: “We’re seeing a clear disconnect between expectation and reality in retirement planning. Many high earners assume they’re on track, but the findings suggest otherwise. It’s concerning that most people are falling short of their retirement goals, especially as pension pots are increasingly used to support family or cover rising living costs.
“Planning is further complicated by Inheritance Tax changes from April 2027, when unused pensions and certain death benefits will count towards an estate. This could make pensions less attractive as a wealth transfer tool, particularly for high net worth individuals who rely on them to pass on wealth.
“Still, the £60,000 annual pension allowance remains a powerful way to build wealth tax-efficiently, but with demands on savings coming from many directions, planning is more important than ever. That’s why we created the Saltus Pension Calculator to help people make better informed decisions about their financial future.”