Lynsey Conway, aged 39, a freelance marketing consultant. Lives in Surrey with her partner and young son. (Salary range £40,000 - £50,000)

Lynsey is only too aware that she hasn't invested much into a pension, but she has put aside some money for retirement - the question is, is it enough?

Lynsey likes weekend breaks abroad, eating in good restaurants and regular jaunts to the theatre or opera. She admits to having expensive tastes and plans to enjoy the finer things in life just as much, if not more, in retirement.

She has two personal pensions, which she pays £100 into each month - the pensions have been running for 15 years but they are only currently worth about £20,000. Lynsey has a string of savings accounts and bonds, and prefers these to pensions.

"I don't like all the jargon associated with pensions. I prefer my money not to be tied up. I don't have a mortgage any more (that has been paid off), I don't have any debts and my money is invested in a string of high-interest accounts and bonds."

She has thought about buying a second property and effectively using this to provide retirement income, but she is concerned that the property market is a little overheated at present.

"Prices are a little scary at the moment, particularly in the South East, and I don't see too many bargains. My plan is to buy a place and renovate it. I will then rent it out until I reach retirement age and then I may sell it depending on the market at that time. I also have the option to free up cash from the sale of the family house, if we decide to downsize when we retire."

Lynsey's Pension Time Machine
Verdict: In today's money Lynsey's target pension income is around £40,000 - her current pension plans alone will not get anywhere near this figure. Her pension pot is projected to be worth £90,314 when she reaches retirement, providing an annual income of just £3,997.

Admittedly she has other savings and property to fall back on but it can be a dangerous game to make "downsizing" a handy fall-back option to fund retirement. It is generally thought of as a last resort rather than a first port of call, and while it might be an easy thing to talk about now, selling the family home and moving from friends and neighbours might not seem such a good idea when you are in your late sixties.

Lynsey's savings and property investments will have to make up the significant short fall caused by her pension. To achieve her target income of £40,000 a year, she would need to have a pension pot of around £900,000. Her non-pension savings are unlikely to amount to more than £150,000, so she has her work cut out.

A second property investment could pay off, and over the longer term the capital value should appreciate, even if there is a short-term fall in house prices. While it might not be an ideal time to invest in a second property with prices stretched the way they are (there is also capital gains tax to pay on any sale) the property could provide a much-needed and regular income stream.

As yet there is no second property to speak of, so Lynsey has some big decisions to make. A retirement spent dining in the best places in Paris and Rome still hangs very much hangs in the balance - it could be more like Pizza Express in Guildford.

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