Only the most optimistic person believes the state will take care of them in their old age. Yet research shows that more than a quarter of the population has no pension provision at all, and as many as half of us are not saving enough for our retirement.

A study by pension provider B&CE Benefit Schemes found that 27% of workers have no idea how much they will get from the state pension, and one in five guessed a figure higher than the real one.

To back up the evidence that relying on the state is a mug’s game, fellow pension provider Axa in 2006 published the result of an experiment with 26 households with occupants aged between 30 and 50. It challenged them to live off the equivalent of the basic state pension for a week, and found that most people could barely last three days on the then £84.25 single person’s basic state pension (£90.70 a week in 2008-9).The average overspend was 168%.

Even if you reckon that no one actually has to survive on the basic pension, because pension credit tops it up for the very poorest to £124.05 a week for a single person and £189.35 for a couple (2008-9 figures), it is clear that anyone who has not provided for themselves is going to have a pretty miserable old age.

So what can we do to make sure our retirement is not spent turning off the heating and eating baked beans out of a can, rather than relaxing and enjoying the longest holiday of our lives?

First of all, today’s workers need to get to grips with the idea that they are going to have to look after themselves in old age, and start saving an adequate amount. This could mean setting aside as much as an eighth of their salary today to pay for some comfort in their twilight years.

Ian Naismith, head of pensions market development at Scottish Widows, says: “Our generally high expectations of what we will need in retirement, and our collective failure to save adequately, raise important questions around financial education as a means of building more realistic expectations about retirement needs and how we prepare for them.

“The truth of the matter is quite simple: if you want to have a fairly comfortable retirement, you should be saving at least 12% of your earnings year in, year out from the age of 30 until retirement at 65. And to achieve the income most people say they’re looking for would require much more than that. As a nation we are not saving nearly enough – yet we still hope we will be comfortable in retirement.”