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Many of us dream of being able to spend our retirement travelling, but before you start planning your adventures, you’ll need to make sure your pension can go the distance.
Whether it’s sipping coffee in a Parisian café, trekking through the Andes, or cruising the Mediterranean, travel often tops the list of our retirement goals. If you need inspiration for your travels, our top travel deals page showcases a range of deals from our travel partners, suitable for all budgets.
If you’re serious about turning your travel dreams into reality, your pension needs to be as well-prepared as your passport. Here’s how to ensure your retirement savings can support your wanderlust.
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If you’re considering seeking professional financial advice on the options available to you, nationwide advice firm HUB Financial Solutions is offering you a free initial consultation with an expert retirement specialist. There’s no obligation; it’s to help you understand your options and how our services work. If you choose to receive paid-for regulated advice, we’ll explain how that works and the fees involved.
HUB Financial Solutions is rated ‘Excellent’ on Trustpilot (Mar 2026). With investing, your capital is at risk.
Know how much you’ll need
Before you can start planning your travels, it’s essential to understand whether you’re financially prepared for retirement and how much income you’re likely to need to fulfil your holiday aspirations.
Craig Rickman, pensions expert at Interactive Investor, said: “Figure out what kind of retirement you want, then calculate the income you’ll need to support it. If you’re hoping to retire before the State Pension kicks in, make sure you have additional savings in something like a self-invested personal pension (SIPP) or individual savings account (ISA) to bridge the gap. And if you’re playing catch-up, don’t forget about pension carry forward rules, which allow you to use unused annual pension allowances from the past three years and get tax relief.”
The Pensions and Lifetime Savings Association (PLSA) provides benchmarks for annual income needs. For example, it says that it would cost a single person £43,300 a year to fund a comfortable lifestyle in retirement. A comfortable retirement is defined as one which provides you with relative financial freedom and a few luxuries each year, such as a fortnight 4* holiday in the Mediterranean with spending money, and three long weekend breaks in the UK.
It also factors in costs such as an extensive bundled broadband and TV subscription, up to £1,500 a year for footwear and clothing costs and around £70 a week on food, plus £40 a week on food out of the home, £20 a week on takeaways, and £100 a month to take others out for a monthly meal.
Assuming you’re on track to receive the full State Pension on retirement (£12,548 in the 2026/27 tax year) you’d need to have saved enough to provide yourself with an annual income after tax of £30,752 if you want to enjoy a comfortable standard of living according to the PLSA standards. Find out more in our article How much do you need to retire comfortably?
If you’re looking to travel more extensively, then this is likely to require additional funds. Travel expenses can vary widely based on where you want to go, how long you plan to be away for, and whether you prioritise luxury or are happy with more basic accommodation.
Each type of travel has its own cost implications. For example, a two-week cruise could cost several thousand pounds, while a month-long stay in South East Asia might be more economical. It’s crucial to estimate these costs and incorporate them into your retirement budget.
Consider the timing of your travels
The timing of your travels can impact both how much it costs you and your pension withdrawals.
For example, travelling during off-peak seasons can reduce costs and avoid crowds. If you’re worried about your pension not being able to cover your travel costs, then you might want to consider phasing your retirement, whereby you gradually reduce your working hours to allow for extended travel periods without fully retiring. Of course, you’ll need to check that your employer offers this flexibility.
Alistair McQueen, head of savings and retirement at Aviva, said: “More and more people are phasing their way into retirement. The worlds of work and personal finances are better equipped than ever before to support a phased approach to retirement. We have more choices than ever and opportunities. And we have an employment market that increasingly values our skills.”
Find out more in our guides Can I take my pension and still work? and Is phased retirement a good idea?
Whenever you’re intending to set off on your travels, you’ll need to plan your pension withdrawals to ensure funds are available when needed without incurring unnecessary tax penalties.
When it’s time to access your pension, you can usually take 25% as a tax-free lump sum, with the remaining 75% as taxable income. Your tax-free cash can be taken all at once or in smaller portions. Workplace schemes may have different rules, so check carefully. Learn more about tax on pension withdrawals in our guide How much tax will I pay on pension withdrawals? and Should I take a tax-free lump sum from my pension?
Maximise your pension savings
To support your travel aspirations, it’s essential to grow your pension savings as much as possible while you’re still working. Travel costs are subject to inflation, which can erode your purchasing power over time. Historically, travel expenses have risen at a rate higher than general inflation, so to combat this you should try to regularly boost your pension contributions, especially during peak earning years.
If you belong to your employer’s workplace pension, make sure you take full advantage of employer pension contributions, especially if they match your own. Dan Coatsworth, investment analyst at AJ Bell, said: “At least 8% of your salary must go into a workplace scheme under auto-enrolment rules; half from you, 3% of your salary from your employer, and the equivalent of 1% from the government.
“This is just a minimum and employers often pay more if you also increase your contribution. Check to see if your employer offers more generous contribution rates if you also chip in more. This is effectively free money to give your pension a boost. Self-employed individuals are excluded from auto-enrolment, but they can still use a self-invested personal pension (SIPP) to save for retirement and enjoy top-ups from the government in the form of tax relief.”
Learn more about pension tax relief in our article How does pension tax relief work?
You should also check up on any older pensions you might have and if you’re finding it a challenge to keep track of these, you might want to consider combining them into a single pot to simplify management and potentially reduce fees.
Mr Coatsworth said: “If you’ve had multiple jobs during your working life, it’s easy to build up a range of pensions with different employers. Combining these into a single pot makes sense from a time management perspective and you might also be able to save on costs. Having a single pot means you can have a clear focus on what you’ve got and how you’re going to hit your goals.”
However, consolidating pensions won’t be right for everyone, and it’s important to seek professional financial advice first to make sure you aren’t giving up any valuable guarantees that your older plans might offer. Find out more in our article Should I consolidate my pensions?
Regularly review your retirement plan
You’ll need to regularly monitor and potentially adjust your plan to ensure it continues to align with your travel goals. You can see how your pension is performing in your annual pension statement, and adjust your contributions as needed.
As retirement approaches, you may want to shift from higher-risk investments like shares to lower-risk options such as bonds or cash, so that any savings you’ve earmarked for your travels don’t suddenly plummet in value just before you need them. Many pension providers automatically do this through a process called “lifestyling,” particularly if you’re in their default fund – but this might not suit everyone, especially those with several years left before retirement. Find out more about how lifestyling works in our guide What is pension lifestyling?
If you’re uncertain whether your retirement savings are on track to fund your travels, an online pension calculator can provide a clearer picture and help you decide if additional contributions are necessary. It’s also crucial to track down all your pension pots, especially if you’ve had multiple employers. Reviewing your employment history and old documents can help.
Another step is reviewing your National Insurance (NI) record to ensure you qualify for the full State Pension, which currently requires 35 years of NI contributions. You can buy back missing years by making Class 3 contributions at £18.40 per week for the 2026/27 tax year. This can boost your State Pension, but whether it’s worthwhile depends on factors like your life expectancy. Each extra complete year of National Insurance you buy will give you up to £6.89 more a week (£358 a year) in State Pension, before any annual increase.
Finally, it’s recommended to book a Pension Wise appointment – a free government service offering impartial guidance on retirement options. While it doesn’t offer personal financial advice, it can help you understand tax implications and drawdown strategies. For tailored help, consider speaking with a professional financial advisor.
Are you protected?
The cost of medical treatment overseas can be exorbitantly expensive, so it’s essential that you protect yourself with comprehensive travel insurance that covers medical emergencies. After all, you want to spend your retirement savings on having fun on your travels, and not paying for treatment if you fall ill or have an accident whilst you’re away.
The Global Health Insurance Card (GHIC) provides access to state-provided healthcare in EU countries and Switzerland, so it is well worth applying for before you go, especially as it is free of charge. You can find out more in our article Everything you need to know about the Global Health Insurance Card.
However, the card should not be seen as a substitute for insurance, as it won’t provide you with any financial protection if, for example, your luggage or personal possessions are lost or stolen, or if you experience travel delays or have to cancel your holiday. Learn more about the importance of travel cover in our guide Travel Insurance for over 50s – Everything you need to know.
When buying travel insurance, it’s really important not to just buy the cheapest policy you find. This is because you need to make sure the policy works for you, and that it provides you with sufficient cover. You must also make sure you disclose any health conditions when you apply, as failure to do so could invalidate your policy. Find out more in our guide How to find travel insurance if you have pre-existing health conditions.
You can choose between single trip cover or annual cover, but if you’re planning to be away for a few times each year, annual cover will almost certainly be a more cost-effective option. Read more in our article Should I buy annual or single trip travel insurance?
A final thought…
Travelling in retirement is not just about having the time; it’s about having the financial means to explore the world.
By understanding what your financial needs are likely to be in retirement, planning for travel expenses, accounting for inflation, ensuring you’re protected, timing your travels wisely and maximising your pension, you can turn your retirement travel dreams into a reality. The world is vast, and with a bit of careful financial planning, it can be yours to explore.
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If you’re considering seeking professional financial advice on the options available to you, nationwide advice firm HUB Financial Solutions is offering you a free initial consultation with an expert retirement specialist. There’s no obligation; it’s to help you understand your options and how our services work. If you choose to receive paid-for regulated advice, we’ll explain how that works and the fees involved.
HUB Financial Solutions is rated ‘Excellent’ on Trustpilot (Mar 2026). With investing, your capital is at risk.
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