Advice from Warren Buffett to help you double up your State Pension

Estimates vary but according to several sources, the average level of income required to have a comfortable retirement is between £24,000 and £27,000 per annum. Of course, every situation is unique. Some retirees may need more than this, and some may need less, but that basic takeaway of £8,546 a year is unlikely to be enough.

The good news is that it’s relatively easy to boost your retirement income. Even for the time poor, there’s a simple solution, and it’s a solution advocated by one of the world’s wealthiest people.

It doesn’t need to be complicated Warren Buffett is widely considered to be the best investor of all time. His savvy decisions have helped him turn his initial $100,000 into a fortune of $88.4bn (at the time of writing), and even though he’s nearly 90 years old, he doesn’t plan to slow down anytime soon.

Buffett doesn’t need to worry about boosting his retirement income, but he has set out a retirement plan for his wife.

“My advice to the trustee [of his estate] could not be more simple: Put 10% of the cash in short-term government bonds and 90% in a very low-cost S&P 500 index fund. I believe the trust’s long-term results from this policy will be superior to those attained by most investors – whether pension funds, institutions or individuals – who employ high-fee managers.”

That was his investment group Berkshire Hathaway’s letter to investors in 2013.

This is exceptionally simple advice from the world’s most successful investor, and therefore excellent advice for investors who want to boost their retirement funds. It might be more suitable for UK investors to use a low-cost tracker fund for a UK index, such as the FTSE 250 rather than an S&P 500 tracker, but the principle remains the same.

Big savings, little effort By investing a small amount every week or month in a low-cost tracker fund, you could end up with a huge pension pot with little effort. For example, over the past 10 years, the FTSE 250 has produced a total annual return of just under 11% per annum.

According to my figures , to be able to retire with an income of £27,000 a year, or £18,454 excluding State Pension income, you would need to save £461,350. This only a rough estimate using the multiply-by-25 rule. The exact figure will always depend on individual circumstances.

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So, if your savings are growing at an annual rate of 11%, how much would you have to put away each year to hit the £461,350 total?

Once again, the exact answer will be different for everyone, but assuming you start with a pot of £1,000, a deposit of just £90 a month for 35 years at a rate of return of 11% would yield the figure required. If you have less time to save, a deposit of £295 a month, or £68 a week for 25 years, would be enough to hit this target.

Put simply, investing doesn’t have to be complicated. By following Buffett’s simple pension saving rule, it’s possible to achieve a comfortable retirement with little effort.

Rupert Hargreaves owns Berkshire Hathaway (NYSE:BRKa) (B shares). The Motley Fool UK has recommended Berkshire Hathaway (B shares). Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.