Do You Think The State Pension Is Enough To Live On? Reading This Might Change Your Mind

Let’s cut to the chase; even if you qualify for the full State Pension, it is unlikely to be sufficient to sustain the lifestyle you want in retirement. You might view the State Pension as a good starting point, but you will need some other form of income during retirement if you are to live relatively comfortably.

Unfortunately, many people don’t have financial plans in place for when they stop working. Even worse, some could end up living on the breadline when they retire, and this situation is tragic. In this article, we aim to give you an insight into how you can prepare financially for your retirement. We’ll kick off by having a more detailed look at the State Pension. 

The state pension

The State Pension came about following the passing of the National Insurance Act in 1948. Then, the contribution-based scheme provided a retirement income for men when they reached 65 and women from age 60. Today, the State Pension still operates on the same basis, but now the age at which both men and women qualify is the same, at 65 years.

Initially, the State Pension was designed for people with a living income well into their old age. However, today, due to inflation, advances in medicine, and changes in lifestyle aspirations, the State Pension is unlikely to provide an adequate income. This case remains despite the government introducing a triple-lock system that guarantees the State Pension will rise by either the rate of inflation, in line with average earnings growth, or at least 2.5%.

When the State Pension was first introduced, it was enough to provide a decent retirement. However, today, the situation has changed, and the State Pension is no longer adequate.

How has the situation changed?

Today, we are living much longer than people did back in 1948. Also, there is a more significant proportion of society in retirement age today than when the State Pension was introduced. Therefore, the overall State Pension pot is being stretched by these two factors.

Another change is people’s aspirations for their retirement. Advances in health, medicine, and physical fitness mean that people want to do more in their retirement. But, of course, doing more usually comes at a financial cost, and the State Pension will not enable you to do much if that is your only source of retirement income.

How much state pension will you receive?

Although the State pension on its own may not be enough to give the retirement of your dreams, it is a good starting point. Therefore, you must understand how much you will receive, as not everyone will receive the same amount.

The amount of State Pension you’ll receive is based on the National Insurance contributions you have throughout your working life. For example, if you have made thirty-five years’ worth of contributions, you will be entitled to the full State pension. However, if you have had periods of unemployment or illness or self-employed, you may not have made sufficient contributions to qualify for the full pension. In this case, you will receive a proportion of the full pension.

You can check to see how much National Insurance contributions you’ve made on the website. You can also find out what your projected weekly pension is likely to be.

Other forms of retirement income

On top of your State Pension, there are other forms of retirement income that you may already have or might consider setting up.

Private pensions

These are long-term investments designed to deliver an income during your retirement. You make regular voluntary contributions, and your money gets invested so that it grows into a substantial pot by the time you retire. Along with workplace pensions, private pension schemes are among the most common forms of retirement funds.

Workplace pensions 

If you are employed, aged over twenty-two, and earning more than £10,000, you will be enrolled in a workplace pension scheme by your employer. You enter such a scheme automatically, as your employer has a legal obligation to ensure all their qualifying employees are enrolled. This process is called auto-enrolment.

With a workplace pension, 4% of your gross salary gets paid straight to your pension. In addition, because these contributions are exempt from tax, you will have your pot boosted by another 1% from money that would typically have gone to the government.

On top of your contributions, your employer is required to contribute a sum equivalent to 3% of your salary. This amount is the minimum your employer must contribute, and they can choose to pay more. Therefore, total funds equal to at least 8% of your salary going into your pension pot. The great news is that you only pay half of it.

Keep working 

Many people look forward to their retirement, and you should do too, as you’ve earned it. However, delaying your retirement and carrying on working, either full-time or part-time, will give you more money to retire with.

Just because you have reached retirement age doesn’t mean you cannot continue contributing to the work environment. Continuing to work allows you to maintain relationships and friendships with work colleagues. Keeping hold of these social aspects of life is beneficial for your mental health and general well-being.

Of course, you will also have the financial benefit of extending your working life, and delaying your retirement can boost your pension significantly. It can also allow you to fill any gaps in your National Insurance contributions, giving you a larger State Pension.

Other sources of income

As well as your pensions, you might have other sources of income to sustain your retirement lifestyle. For instance, you might have income from property, inheritance, or other investments. All of these need to be considered when calculating your retirement income. A financial advisor can help you get the best from these assets.


The State Pension is a good foundation for your retirement, and you should ensure you qualify for as much as possible. However, on its own, the State Pension is unlikely to provide enough support for your retirement.

If you have no other retirement funds, you should consider setting some up immediately. Also, for your existing private or workplace pensions, you should make top-up payments as often as possible.

Your retirement can be wonderful, and you should look forward to this time. Having sufficient finances in place will allow you to have the retirement lifestyle you desire. Unfortunately, the State Pension alone is unlikely to provide this.

If you are looking at options for your pension ore retirement, get in touch with a regulated pensions specialist like Portafina or, view the information at Pension Wise.

Contact Us

Give us a call or drop our team an email and we will contact you. We endeavour to answer all inquiries within 24 hours during business days.