Firstly, you need to identify the income you expect to receive when you retire.  At the moment, many people will get the basic state pension from the government when they reach state pension age.  This is currently £90.70 a week for a single person and £145.05 for a couple (2008/2009 tax year).  This pension is based on the National Insurance (NI) contributions you’ve paid during your working lifetime. If you have missed any payments during that time, for instance during periods when you were not working,  then the amount of basic state pension you receive will be reduced.

You could also qualify for the State Second Pension (S2P), previously known as State Earnings Related Pension (SERPs).

You may also have heard of the Pension Credit scheme, introduced in October 2003. It is a means tested benefit for people over 60, worked out based on the level of income and savings that you have. It currently (since April 2008) guarantees everyone aged 60 and over an income of at least £124.05 a week if you’re single and £189.35 a week for a couple.

For more information on state pensions go to - www.thepensionservice.gov.uk. Please bear in mind that what the state offers may change in the future.