Retiring at 60 is an attractive goal for many people in the UK, since it offers the freedom to enjoy life while still in good health. But can you afford to stop working six years before you start to receive your State Pension? 

Working out how much you’ll need to retire at 60 depends on your lifestyle, pension savings, and other investments.

In this Moneyfarm guide we’ll explain the key numbers, rules and options to help you assess whether your retirement plans are on track and how your pension pots can support the life you want after 60.

UK Retirement Age Overview

• There is no fixed retirement age in the UK: you can retire whenever your finances allow.
• State Pension age: currently 66 for men and women, rising to 67 between 2026 and 2028.
• Pension access age: currently 55, increasing to 57 in April 2028.

How much do I need to retire at 60?

A lot of people want to know how to retire at 55. It’s a great age to retire, but it’s a little too early for many. Retiring this young means relying on having earned a well above-average salary in the run-up and having developed a sound investment strategy. It also means opening a good private pension with excellent growth prospects at an early age.

If you retire early and your pension and other investments have yet to perform as well as predicted, you run the risk of running out of money later in your retirement years.

The combination of these factors may lead many to remain at work a little longer and, instead, retire at 60.

In terms of answering the big question – “what is the amount needed to retire at 60?” – it all depends on what standard of living you hope to have after you’ve stopped working. If we use the figures shown on retirementlivingstandards.org.uk, the required amount of income in retirement for the three different levels of lifestyle looks like this (update to latest PLSA Annual Conference 2025):

• A minimum or basic retirement lifestyle – £13,400  per annum.
• A moderate retirement lifestyle – £31,700  per annum.
• A comfortable retirement lifestyle – £43,900  per annum

These figures are for a single person. You’ll need even more if you’re talking about a couple.

How do I withdraw from my retirement accounts efficiently?

“I want to retire at 60. What’s the best way of withdrawing money from my pension?” 

The best way of accessing the funds in your pension in your golden years is to go down the pension drawdown route, providing you use it sensibly.

Pension drawdown allows you to withdraw as much as you want from your pension pot. You can do this from the age of 55 onwards (57 from 2028 for most savers). Up to 25% of your pension pot can typically be taken tax-free, subject to a lump sum allowance of £268,275 for most people. Withdrawals above this are taxed at your marginal rate of income tax, rather than through penalties.

It’s important to remember that the more you withdraw early, the less remains invested for future growth.

Taking large sums at the start of retirement can increase the risk of running out of money later, especially if markets fall. 

Keeping part of your pot invested can help your savings continue to grow, though investment values can go down as well as up.

Example: David, aged 60, began retirement with a £450,000 pension pot and withdrew £40,000 in his first year to renovate his home. When markets dipped the following year, his pot fell in value, and the large early withdrawal meant fewer invested funds left to recover. After reviewing his plan, he had to cut down his withdrawals to £18,000 a year to improve long-term sustainability.

How much retirement income can I receive at 60?

You can receive as much retirement income as your pension pot invested funds allow. However, as mentioned above, you should consider the possibility of your retirement income being susceptible to income tax.

Whether we are discussing retirement age 60, or any other age, pension income is taxable according to current income thresholds. So you should review your 50s retirement savings, and if you haven’t got any investments in tax wrappers, like stocks and shares ISAs, you should change things.

For most people retiring before the State Pension age (currently 66, rising to 67 between 2026 and 2028), it’s important to plan how to bridge those years without exhausting your pension too early.

A balanced withdrawal strategy and diversified investments can help provide flexibility and resilience through retirement.

Example: Karen, aged 60, had a £300,000 pension and £70,000 in a Stocks and Shares ISA. To delay drawing heavily on her pension, she withdrew £12,000 a year tax-free from her ISA between ages 60 and 66. This reduced the taxable pension withdrawals she needed to make and kept more of her pension invested for growth.

Talking about tax wrappers, you might be interested in the best ISAs rate for over 60s.

How much do I need to retire at 60? Use a calculator

You could retire at 60 with 500k, but it depends on what sort of retirement lifestyle you hope to enjoy. If you are happy to spend frugally throughout your retirement years, a £500K pot will go a fair way towards securing a reasonably comfortable retirement.

Example: Richard retired at 60 with a £500,000 pension pot and no mortgage. He planned to spend around £28,000 a year until his State Pension started. Using a 3.5 percent withdrawal strategy and keeping part of the pot invested, his plan remained sustainable. However, when inflation rose, he reduced discretionary spending to ensure the pot would last into his late 80s. This shows how lifestyle choices and spending adjustments can determine whether £500,000 is enough.

You can use our pension calculator to learn how much you need to retire: it’s a valuable tool for answering the question “how much do I need for retirement”. It will give you helpful information, including the size of the pension pot you need and the ideal monthly contributions you need to make depending on age.

What are the best retirement options at age 60?

Reaching 60 doesn’t mean your investing journey is over, in many cases, it simply changes direction. The goal shifts from building wealth to preserving income and ensuring your money lasts throughout retirement.

You can have several options, and the right mix depends on your financial situation, risk tolerance, and future plans.

Flexi-access drawdown

You keep your pension invested and withdraw income when needed. This approach offers flexibility but carries investment risk, the value of your pot can fall as well as rise.

Lifetime annuity

An annuity converts some or all of your pension into a guaranteed income for life. It can provide certainty, though rates depend on factors such as age, health, and interest rates.

Partial retirement or phased drawdown

You don’t have to stop work entirely. Combining part-time employment with gradual pension withdrawals can reduce financial pressure on your savings.

Use savings or cash-based vehicles alongside your pension

In addition to your pension, it can be sensible to hold accessible savings that don’t need to be drawn immediately. For example, our blog on the best savings accounts for over-60s discusses how cash savings or ISAs can provide liquidity and reduce pressure on your pension pot.

Using ISAs for tax-efficient income

Alongside pensions, Stocks & Shares ISAs can be used to generate income or fund large expenses. Withdrawals are tax-free, offering flexibility in how you manage your retirement cash flow.

A balanced approach, combining secure income from an annuity, flexible withdrawals through drawdown, and tax-free income from ISAs, can offer both stability and adaptability through your 60s and beyond.

Just because you retire at 60 doesn’t mean your investment days are over, – far from it. However, if you know the best savings account for over 60s, you’ll know there is still money to be made, even though you took the decision to retire early.

If you invest wisely, you can grow your investment income even further. However, it’s essential to understand that investing carries a certain amount of risk. Invested funds can go down in value as well as up.

Can I retire at 60?

Yes, if you’ve got the money needed to retire at 60, you can do so and have been able to since April 2010, when the minimum retirement age was reset at 55. However, please note that it will be reset again, this time to 57, in 2028.

I want to retire at 60, but I am self-employed

If you are self-employed, it is still possible to retire at 60, but you must invest in a good self-employed pension. If you don’t have a workplace pension to fall back on, you could end up with no pension at 60 other than your state pension – and only then if you’ve made enough NI contributions.

A good way around this problem is to invest in a SIPP (Self-Invested Pension Plan). Even if you are not well versed in finance, don’t be alarmed by the term “self-invested.” You can manage your own account if you prefer, but if you don’t have the time, a financial adviser or retirement specialist adviser will be able to help.

A SIPP gives you access to the same tax relief as other pension schemes, meaning HMRC adds 20% to your contributions automatically, with higher-rate taxpayers able to claim an additional 20% or 25% through self-assessment. For someone in their 60s, this can make every contribution go further.

Beyond the tax benefit, SIPPs offer key advantages for those approaching retirement:

• Investment choice: You can select from a broad range of funds, shares, bonds and ETFs to match your risk tolerance and time horizon.
• Flexibility: You can continue contributing and growing your pension pot even if you work part-time or reduce hours.
• Control: You decide how to take income — through flexi-access drawdown, lump sums, or a mix of both — helping you tailor withdrawals to your needs.
• Consolidation: You can transfer old pensions into one SIPP to simplify management and potentially reduce fees.
• Inheritance flexibility: SIPPs often allow you to pass on remaining funds to beneficiaries outside your estate for Inheritance Tax purposes, depending on circumstances.

If you prefer not to manage investments directly, many SIPP providers offer managed portfolios or digital platforms that automatically align your risk level and retirement goals. You can also seek help from a regulated financial adviser to make sure your retirement plan remains appropriate.

How to retire at 60 comfortably

I want to retire at 60, but I am still trying to work out whether I will have enough retirement income to allow me to live a comfortable lifestyle. What should I do? It’s another frequently asked question, and one answer is to take a part-time job.

To make the difference you are looking for, you can defer your state pension because of any part-time work income. However, to start receiving your state pension, you must request it. You usually receive a letter from the DWP about two months before reaching state pension age. Your pension is automatically deferred until you apply if you don’t reply. When you do, the payments you receive will be increased accordingly.

Another thing you can think about is taking a lodger. Of course, you must ensure that anyone you allow into your home is trustworthy. You can read an informative article on saga.co.uk discussing the pros and cons of taking this option.

Your primary target would be to get rental income, which could be tax-free under the government’s rent-a-room scheme. The other possible benefit of renting is that if you live alone, you will have company.

Things to plan for when retiring at 60

Planning for retirement age at 60 involves more than just checking your pension balance. It’s about creating a financial strategy that supports you for 20 to 30 years or more, covering everyday spending, unexpected costs, and longer-term care if needed.

The first step is to set clear financial goals. Ask yourself:

• What level of income will I need to maintain my desired lifestyle?
• How will my spending change once I stop working?
• Do I want to leave an inheritance or use my savings mainly for my own retirement?

Review these goals regularly, as inflation, market conditions, or health changes can all affect your plans.

Most people in their 60s have accumulated several workplace or personal pensions over their career. Tracking these can be difficult, especially if they’re held with different providers and invested in different ways. Comparing each pot’s fees, performance and flexibility is essential. Some older pensions may include valuable guarantees, for instance, protected tax-free cash or guaranteed annuity rates, so always check before making any pension transfer.

If you discover that your pensions are scattered or some are underperforming, consolidation can simplify management and potentially reduce costs.

Example: Julia, aged 60, discovered she had five small workplace pensions totalling £185,000. Two had higher-than-average fees and one included a valuable guaranteed annuity rate. After reviewing each pot, she consolidated four of them into a single low-cost SIPP, keeping the guaranteed pot separate. This reduced annual charges and made it easier to manage her withdrawals during her 60s.

Beyond pensions, build a diversified income plan that may include:

• Stocks & Shares ISAs for tax-free withdrawals and flexibility.
• Cash savings for short-term spending and emergencies.
• Investments for long-term growth to offset inflation risk.
• Property income if you own buy-to-let or are considering downsizing.

Finally, create a withdrawal strategy that balances income needs with preserving your capital. A sustainable withdrawal rate — often around 3–4% of your invested assets per year, depending on market conditions — can help reduce the risk of depleting your savings too soon.

Retirement at 60 offers freedom and opportunity, but it works best with a well-structured plan and regular reviews.

Bereavement Support Payment, aka widow’s pension at 60 

You may be eligible for Bereavement Support Payment if your spouse, civil partner or in some cases your partner you were living with has died.

To qualify:

• At the time of death you must have been under State Pension age and living in the UK (or another country that pays UK bereavement benefits).
• Your partner must have paid sufficient National Insurance contributions (at least 25 weeks in one tax year since 6 April 1975), or died as a result of a workplace accident or work-related disease.
• You should submit your claim as soon as possible to receive the full lump-sum payment (£2,500 or £3,500) and up to 18 monthly payments (£100 or £350)
• You should normally claim within three months of your partner’s death in order to receive the full payment. If you claim later (but normally within 21 months), you may receive reduced payments. The benefit is tax-free and is not means-tested in the first 12 months.

The benefit is not means-tested and income or savings do not normally affect your eligibility.

You can learn more about bereavement support on the gov.uk website.

Understanding Investment Risk Tolerance and Asset Allocation for a Secure Future

When planning for retirement, one of the most crucial aspects to consider is your investment risk tolerance and asset allocation. These factors will significantly influence how your retirement savings grow over time and how comfortably you can live in your golden years.

Understanding your risk tolerance involves assessing your willingness and ability to withstand fluctuations in your investment portfolio. Are you someone who can sleep well at night even if the market takes a downturn, or do you prefer more stable, less volatile investments? Your answers to these questions will guide your asset allocation strategy, which is essentially how you divide your investments among different asset classes like stocks, bonds, and cash equivalents.

If you aim to Retire at 60, it’s essential to start this assessment early. The closer you are to retirement, the less risk you may want to take, as you’ll have less time to recover from any potential losses. However, being too conservative can also be a pitfall, as inflation could erode the purchasing power of your savings.

A balanced approach often involves a diversified portfolio that includes a mix of high-risk, high-reward assets and low-risk, stable assets. Financial advisors often recommend a shift towards more conservative investments as you age. However, the ‘right’ asset allocation varies from person to person and may require periodic adjustments based on life changes, economic conditions, and financial goals. Consulting a financial advisor can provide tailored advice to help you navigate the complexities of investment risk tolerance and asset allocation as you plan for a fulfilling retirement.

Key Takeaways

• Plan early and review often. Whether you aim to retire at 60, start with clear goals and revisit them regularly to stay on track.
• Know the rules. The State Pension age is currently 66, rising to 67 between 2026 and 2028, and most private pensions can be accessed from age 55 (rising to 57 in 2028).
• Estimate your needs realistically. A single person typically needs around £13,400 – £43,900 a year in retirement, depending on lifestyle (PLSA 2025).
• Diversify your income sources by combining pensions, ISAs, savings, and investments to balance growth potential and stability.
• Use tax allowances efficiently by taking advantage of pension tax relief, ISA allowances, and tax-free cash limits to make your money work harder.
• Avoid rushing withdrawals as drawing too much too soon can shorten the life of your pension pot and increase your tax bill.
• Consider professional advice. A regulated adviser can help you optimise drawdown, annuity, and investment strategies to suit your goals.

Final thoughts

The last thing you need is to reach the state pension age and find you don’t have enough money in your pot. So, it’s important to save for retirement as diligently as you can, no matter what age you hope to retire.

FAQ

Can I work after I retire at 60?

Yes, you can retire at 60 and continue to work. You can work for as long as you want, and the number of hours you can work in retirement is not restricted.

What is the disadvantage of retirement at 60?

If you retire at 60, you will not be able to claim your state pension until you hit the state pension age. So you need to have saved an adequate retirement income for the several years you will not receive an income from the state.

How can I retire at 60 and not run out of money?

One of the ways to retire at 60 without running out of money is to purchase an annuity. With annuities, you are guaranteed a steady income for life. The downside is that you need a large pension pot to get the desired annuity income you may want.

Retire at 60: How much do I need? Is 500k enough?

Retiring at 60 is an attractive goal for many people in the UK, since it offers the freedom to enjoy life while still in good health. But can you afford to stop working six years before you start to receive your State Pension? 

Working out how much you’ll need to retire at 60 depends on your lifestyle, pension savings, and other investments.

In this Moneyfarm guide we’ll explain the key numbers, rules and options to help you assess whether your retirement plans are on track and how your pension pots can support the life you want after 60.

Key UK Retirement Facts

• There is no fixed retirement age in the UK: you can retire whenever your finances allow.
• State Pension age: currently 66 for men and women, rising to 67 between 2026 and 2028.
• Pension access age: currently 55, increasing to 57 in April 2028.

How much do I need to retire at 60?

A lot of people want to know how to retire at 55. It’s a great age to retire, but it’s a little too early for many. Retiring this young means relying on having earned a well above-average salary in the run-up and having developed a sound investment strategy. It also means opening a good private pension with excellent growth prospects at an early age.

If you retire early and your pension and other investments have yet to perform as well as predicted, you run the risk of running out of money later in your retirement years.

The combination of these factors may lead many to remain at work a little longer and, instead, retire at 60.

In terms of answering the big question – “what is the amount needed to retire at 60?” – it all depends on what standard of living you hope to have after you’ve stopped working. If we use the figures shown on retirementlivingstandards.org.uk, the required amount of income in retirement for the three different levels of lifestyle looks like this (update to latest PLSA Annual Conference 2025):

• A minimum or basic retirement lifestyle – £13,400  per annum.
• A moderate retirement lifestyle – £31,700  per annum.
• A comfortable retirement lifestyle – £43,900  per annum

These figures are for a single person. You’ll need even more if you’re talking about a couple.

How do I withdraw from my retirement accounts efficiently?

“I want to retire at 60. What’s the best way of withdrawing money from my pension?” 

The best way of accessing the funds in your pension in your golden years is to go down the pension drawdown route, providing you use it sensibly.

Pension drawdown allows you to withdraw as much as you want from your pension pot. You can do this from the age of 55 onwards (57 from 2028 for most savers). Up to 25% of your pension pot can typically be taken tax-free, subject to a lump sum allowance of £268,275 for most people. Withdrawals above this are taxed at your marginal rate of income tax, rather than through penalties.

It’s important to remember that the more you withdraw early, the less remains invested for future growth.

Taking large sums at the start of retirement can increase the risk of running out of money later, especially if markets fall. 

Keeping part of your pot invested can help your savings continue to grow, though investment values can go down as well as up.

Example: David, aged 60, began retirement with a £450,000 pension pot and withdrew £40,000 in his first year to renovate his home. When markets dipped the following year, his pot fell in value, and the large early withdrawal meant fewer invested funds left to recover. After reviewing his plan, he had to cut down his withdrawals to £18,000 a year to improve long-term sustainability.

How much retirement income can I receive at 60?

You can receive as much retirement income as your pension pot invested funds allow. However, as mentioned above, you should consider the possibility of your retirement income being susceptible to income tax.

Whether we are discussing retirement age 60, or any other age, pension income is taxable according to current income thresholds. So you should review your 50s retirement savings, and if you haven’t got any investments in tax wrappers, like stocks and shares ISAs, you should change things.

For most people retiring before the State Pension age (currently 66, rising to 67 between 2026 and 2028), it’s important to plan how to bridge those years without exhausting your pension too early.

A balanced withdrawal strategy and diversified investments can help provide flexibility and resilience through retirement.

Example: Karen, aged 60, had a £300,000 pension and £70,000 in a Stocks and Shares ISA. To delay drawing heavily on her pension, she withdrew £12,000 a year tax-free from her ISA between ages 60 and 66. This reduced the taxable pension withdrawals she needed to make and kept more of her pension invested for growth.

Talking about tax wrappers, you might be interested in the best ISAs rate for over 60s.

How much do I need to retire at 60? Use a calculator

You could retire at 60 with 500k, but it depends on what sort of retirement lifestyle you hope to enjoy. If you are happy to spend frugally throughout your retirement years, a £500K pot will go a fair way towards securing a reasonably comfortable retirement.

Example: Richard retired at 60 with a £500,000 pension pot and no mortgage. He planned to spend around £28,000 a year until his State Pension started. Using a 3.5 percent withdrawal strategy and keeping part of the pot invested, his plan remained sustainable. However, when inflation rose, he reduced discretionary spending to ensure the pot would last into his late 80s. This shows how lifestyle choices and spending adjustments can determine whether £500,000 is enough.

You can use our pension calculator to learn how much you need to retire: it’s a valuable tool for answering the question “how much do I need for retirement”. It will give you helpful information, including the size of the pension pot you need and the ideal monthly contributions you need to make depending on age.

What are the best retirement options at age 60?

Reaching 60 doesn’t mean your investing journey is over, in many cases, it simply changes direction. The goal shifts from building wealth to preserving income and ensuring your money lasts throughout retirement.

You can have several options, and the right mix depends on your financial situation, risk tolerance, and future plans.

Flexi-access drawdown

You keep your pension invested and withdraw income when needed. This approach offers flexibility but carries investment risk, the value of your pot can fall as well as rise.

Lifetime annuity

An annuity converts some or all of your pension into a guaranteed income for life. It can provide certainty, though rates depend on factors such as age, health, and interest rates.

Partial retirement or phased drawdown

You don’t have to stop work entirely. Combining part-time employment with gradual pension withdrawals can reduce financial pressure on your savings.

Use savings or cash-based vehicles alongside your pension

In addition to your pension, it can be sensible to hold accessible savings that don’t need to be drawn immediately. For example, our blog on the best savings accounts for over-60s discusses how cash savings or ISAs can provide liquidity and reduce pressure on your pension pot.

Using ISAs for tax-efficient income

Alongside pensions, Stocks & Shares ISAs can be used to generate income or fund large expenses. Withdrawals are tax-free, offering flexibility in how you manage your retirement cash flow.

A balanced approach, combining secure income from an annuity, flexible withdrawals through drawdown, and tax-free income from ISAs, can offer both stability and adaptability through your 60s and beyond.

Just because you retire at 60 doesn’t mean your investment days are over, – far from it. However, if you know the best savings account for over 60s, you’ll know there is still money to be made, even though you took the decision to retire early.

If you invest wisely, you can grow your investment income even further. However, it’s essential to understand that investing carries a certain amount of risk. Invested funds can go down in value as well as up.

Can I retire at 60?

Yes, if you’ve got the money needed to retire at 60, you can do so and have been able to since April 2010, when the minimum retirement age was reset at 55. However, please note that it will be reset again, this time to 57, in 2028.

I want to retire at 60, but I am self-employed

If you are self-employed, it is still possible to retire at 60, but you must invest in a good self-employed pension. If you don’t have a workplace pension to fall back on, you could end up with no pension at 60 other than your state pension – and only then if you’ve made enough NI contributions.

A good way around this problem is to invest in a SIPP (Self-Invested Pension Plan). Even if you are not well versed in finance, don’t be alarmed by the term “self-invested.” You can manage your own account if you prefer, but if you don’t have the time, a financial adviser or retirement specialist adviser will be able to help.

A SIPP gives you access to the same tax relief as other pension schemes, meaning HMRC adds 20% to your contributions automatically, with higher-rate taxpayers able to claim an additional 20% or 25% through self-assessment. For someone in their 60s, this can make every contribution go further.

Beyond the tax benefit, SIPPs offer key advantages for those approaching retirement:

• Investment choice: You can select from a broad range of funds, shares, bonds and ETFs to match your risk tolerance and time horizon.
• Flexibility: You can continue contributing and growing your pension pot even if you work part-time or reduce hours.
• Control: You decide how to take income — through flexi-access drawdown, lump sums, or a mix of both — helping you tailor withdrawals to your needs.
• Consolidation: You can transfer old pensions into one SIPP to simplify management and potentially reduce fees.
• Inheritance flexibility: SIPPs often allow you to pass on remaining funds to beneficiaries outside your estate for Inheritance Tax purposes, depending on circumstances.

If you prefer not to manage investments directly, many SIPP providers offer managed portfolios or digital platforms that automatically align your risk level and retirement goals. You can also seek help from a regulated financial adviser to make sure your retirement plan remains appropriate.

How to retire at 60 comfortably

I want to retire at 60, but I am still trying to work out whether I will have enough retirement income to allow me to live a comfortable lifestyle. What should I do? It’s another frequently asked question, and one answer is to take a part-time job.

To make the difference you are looking for, you can defer your state pension because of any part-time work income. However, to start receiving your state pension, you must request it. You usually receive a letter from the DWP about two months before reaching state pension age. Your pension is automatically deferred until you apply if you don’t reply. When you do, the payments you receive will be increased accordingly.

Another thing you can think about is taking a lodger. Of course, you must ensure that anyone you allow into your home is trustworthy. You can read an informative article on saga.co.uk discussing the pros and cons of taking this option.

Your primary target would be to get rental income, which could be tax-free under the government’s rent-a-room scheme. The other possible benefit of renting is that if you live alone, you will have company.

Things to plan for when retiring at 60

Planning for retirement age at 60 involves more than just checking your pension balance. It’s about creating a financial strategy that supports you for 20 to 30 years or more, covering everyday spending, unexpected costs, and longer-term care if needed.

The first step is to set clear financial goals. Ask yourself:

• What level of income will I need to maintain my desired lifestyle?
• How will my spending change once I stop working?
• Do I want to leave an inheritance or use my savings mainly for my own retirement?

Review these goals regularly, as inflation, market conditions, or health changes can all affect your plans.

Most people in their 60s have accumulated several workplace or personal pensions over their career. Tracking these can be difficult, especially if they’re held with different providers and invested in different ways. Comparing each pot’s fees, performance and flexibility is essential. Some older pensions may include valuable guarantees, for instance, protected tax-free cash or guaranteed annuity rates, so always check before making any pension transfer.

If you discover that your pensions are scattered or some are underperforming, consolidation can simplify management and potentially reduce costs.

Example: Julia, aged 60, discovered she had five small workplace pensions totalling £185,000. Two had higher-than-average fees and one included a valuable guaranteed annuity rate. After reviewing each pot, she consolidated four of them into a single low-cost SIPP, keeping the guaranteed pot separate. This reduced annual charges and made it easier to manage her withdrawals during her 60s.

Beyond pensions, build a diversified income plan that may include:

• Stocks & Shares ISAs for tax-free withdrawals and flexibility.
• Cash savings for short-term spending and emergencies.
• Investments for long-term growth to offset inflation risk.
• Property income if you own buy-to-let or are considering downsizing.

Finally, create a withdrawal strategy that balances income needs with preserving your capital. A sustainable withdrawal rate — often around 3–4% of your invested assets per year, depending on market conditions — can help reduce the risk of depleting your savings too soon.

Retirement at 60 offers freedom and opportunity, but it works best with a well-structured plan and regular reviews.

Bereavement Support Payment, aka widow’s pension at 60 

You may be eligible for Bereavement Support Payment if your spouse, civil partner or in some cases your partner you were living with has died.

To qualify:

• At the time of death you must have been under State Pension age and living in the UK (or another country that pays UK bereavement benefits).
• Your partner must have paid sufficient National Insurance contributions (at least 25 weeks in one tax year since 6 April 1975), or died as a result of a workplace accident or work-related disease.
• You should submit your claim as soon as possible to receive the full lump-sum payment (£2,500 or £3,500) and up to 18 monthly payments (£100 or £350)
• You should normally claim within three months of your partner’s death in order to receive the full payment. If you claim later (but normally within 21 months), you may receive reduced payments. The benefit is tax-free and is not means-tested in the first 12 months.

The benefit is not means-tested and income or savings do not normally affect your eligibility.

You can learn more about bereavement support on the gov.uk website.

Understanding Investment Risk Tolerance and Asset Allocation for a Secure Future

When planning for retirement, one of the most crucial aspects to consider is your investment risk tolerance and asset allocation. These factors will significantly influence how your retirement savings grow over time and how comfortably you can live in your golden years.

Understanding your risk tolerance involves assessing your willingness and ability to withstand fluctuations in your investment portfolio. Are you someone who can sleep well at night even if the market takes a downturn, or do you prefer more stable, less volatile investments? Your answers to these questions will guide your asset allocation strategy, which is essentially how you divide your investments among different asset classes like stocks, bonds, and cash equivalents.

If you aim to Retire at 60, it’s essential to start this assessment early. The closer you are to retirement, the less risk you may want to take, as you’ll have less time to recover from any potential losses. However, being too conservative can also be a pitfall, as inflation could erode the purchasing power of your savings.

A balanced approach often involves a diversified portfolio that includes a mix of high-risk, high-reward assets and low-risk, stable assets. Financial advisors often recommend a shift towards more conservative investments as you age. However, the ‘right’ asset allocation varies from person to person and may require periodic adjustments based on life changes, economic conditions, and financial goals. Consulting a financial advisor can provide tailored advice to help you navigate the complexities of investment risk tolerance and asset allocation as you plan for a fulfilling retirement.

Key Takeaways for Retiring at 60

• Plan early and review often. Whether you aim to retire at 60, start with clear goals and revisit them regularly to stay on track.
• Know the rules. The State Pension age is currently 66, rising to 67 between 2026 and 2028, and most private pensions can be accessed from age 55 (rising to 57 in 2028).
• Estimate your needs realistically. A single person typically needs around £13,400 – £43,900 a year in retirement, depending on lifestyle (PLSA 2025).
• Diversify your income sources by combining pensions, ISAs, savings, and investments to balance growth potential and stability.
• Use tax allowances efficiently by taking advantage of pension tax relief, ISA allowances, and tax-free cash limits to make your money work harder.
• Avoid rushing withdrawals as drawing too much too soon can shorten the life of your pension pot and increase your tax bill.
• Consider professional advice. A regulated adviser can help you optimise drawdown, annuity, and investment strategies to suit your goals.

Final thoughts

The last thing you need is to reach the state pension age and find you don’t have enough money in your pot. So, it’s important to save for retirement as diligently as you can, no matter what age you hope to retire.

FAQ