Brits must now accumulate a pension pot of nearly £700,00 to be able to have a comfortable retirement, according to new analysis.

Wealth management firm Quilter has calculated the new requirements by taking into account the latest Pensions UK Retirement Living Standards update.

The metric – developed to provide an accurate figure on the cost of essentials, social activities and hobbies – is regularly reviewed to take into account inflation and other changes to the UK’s circumstances.

According to Quilter, a retiree who is single in the UK now needs £691,000 in their pension pot in order to have a comfortable retirement.

Meanwhile, for a retired couple, the required pension pot total for each person drops to £389,000.

The analysis finds the absolute minimum pension pot required for an individual would be £28,000.

For a comfortable retirement it is assumed an individual spends £45,400 a year. For a couple, it is assumed annual expenditure is £62,700.

Quilter’s report uses the typical annual expenditure required for a comfortable life after work under the Pensions UK Retirement Living Standards, and the current state pension to work out how large a pension pot would be required to sustain the level of living.

Jon Greer, head of retirement policy at Quilter, said: “The state pension still forms a crucial foundation and goes a long way towards helping people achieve a minimum standard of living, however stepping up to a moderate or comfortable lifestyle requires significant pension savings.

“While most people are on track to cover the basics, far fewer are likely to achieve the level of flexibility and financial security many would aspire to.”

The state pension is currently worth £12,548 per year, with the amount rising each year by the rate of inflation, average earnings of 2.5 per cent – whichever is higher – under a mechanism known as the “state pension triple lock”.

Greer also warned Quilter’s figures were based on the assumption that retirees owned their own homes outright and did not have to pay rent or a mortgage.

The number of pensioners who are renting has surged in recent years, with the proportion of over-65s in private rentals expected to treble by the 2040s.

Meanwhile, the rise in house prices means an increasing number of people are taking out mortgages over a longer period of time.

Greer said: “Factoring in housing costs could push the required income higher still, making early planning and regular reviews even more important.”

He further warned the pension situation is set to become more complex for Brits in the coming years, with new rules on tax being introduced and repeated calls for the state pension triple lock to be axed.

He explained: “The current policy landscape, including pensions becoming subject to inheritance tax from April 2027, changes to salary sacrifice, and the never-ending threat of further pension tax changes at each budget, have made things increasingly confusing for savers.

“This may make pensions seem less attractive, but pensions should still be viewed as an incredibly efficient way to save for retirement and these figures bring into sharp focus just how important it is that people take ownership of their savings.

“Assessing both how much you are saving and how you structure and use your pension and other assets is vital.”

Research from Pensions UK indicates 51 per cent of people focus their spending on their current needs rather than on future planning.

Only 23 per cent of Brits are confident they know how much they need to save in order to have a comfortable retirement.