For the average Brit on the cusp of retirement, a dream retirement scenario will include a detached house with a garden in a village, 21 days abroad on holiday a year, 468 hours on a hobby and 364 hours of free time with the grandchildren each year, the study found.

But research by insurer LV= found that this will cost a whopping £225,756 over a typical 17 year retirement.

Despite dreaming of the perfect life after work, 8% of 60 to 65s admit they have no form of pension or retirement funds in place whatsoever.

This means that an estimated 315,200 people will be relying on nothing but the state pension of £110.15 per week, or £5,727.80 a year in retirement. With a happy retirement costing at least £10,820 per year or £208.08 per week, this group of people will find themselves falling short in their pursuit of happiness by £5,092 in their first year and £106,243 over the course of their retirement.

The report found that of those 60-65s who do have a pension, over a quarter do not know the value of their current pension pot.

Industry figures show that a third of people have a pension pot of less than £10,000. However, given that half (49%) of those who are still to retire have not sought any form of financial advice, the true shortfall in their pension will not become apparent until they are ready to retire.

Vanessa Owen, LV= head of annuities and equity release, said: “It’s never too late to make a difference, but it’s important that people plan for the retirement as soon as possible and also explore all of the options available to them as retirement approaches, so they can maximise their income once their working lives come to an end.

“With people spending longer in retirement one of the challenges is looking at how they fund it. Today’s retirees now have many options available to them at the point of retirement and its important they make the best possible choice, as it will impact them for years to come. Seeking professional advice can put them on the path to a retirement where they have both the buying power and quality of life they desire.”