Pensions Planning: The NUMBER

MallyGirl

Mine was less than half the value but bizarrely the calculator said it was smaller than the cost models so they had to size up. It is quite a big house.

bownyboy

I don't trust the rebuild calculator as it came out at £375k for us. We have a 3-bed semi in Surrey. Sold prices are around £950k.

Building costs have doubled, tripled, and gone through the roof in the last year or so. 

You'd be lucky to get a double-story extension for £300k now. Sadly.

cfw1994

I do wonder how one is meant to even vaguely accurately put a number on that now.
I know some insurers pop their own nominal limit to ensure they cover things. 

Linton

bownyboy said:

I don't trust the rebuild calculator as it came out at £375k for us. We have a 3-bed semi in Surrey. Sold prices are around £950k.

Building costs have doubled, tripled, and gone through the roof in the last year or so. 

You'd be lucky to get a double-story extension for £300k now. Sadly.

Dont forget the rebuild cost does not include the cost of the land since you already have it.  So, depening on the size of your plot, the calculated rebuild cost could be right. The rebuild cost should not depend greatrly on where the house is.

MallyGirl

bownyboy said:

I don't trust the rebuild calculator as it came out at £375k for us. We have a 3-bed semi in Surrey. Sold prices are around £950k.

Building costs have doubled, tripled, and gone through the roof in the last year or so. 

You'd be lucky to get a double-story extension for £300k now. Sadly.

Not a dissimilar figure to the one I got for our 3 storey, plus cellar, detached Victorian property in Berkshire. There were not enough questions to answer to draw out the complexity of rebuilding. As an estimate it has little value which is the reason I always opt for 'unlimited' on buildings insurance 

worlestone

Apologies for the thread hijack comment... I've just stumbled across this (booked marked) thread whilst looking for something else, but glad I have. I needed to use the ABI result calculator a few days ago as our house insurance is due and the current policy has a blanket 'up to £1m' limit, I was surprised at the outcome. We bought our house 3 years ago for £400k, south coast Dorset, standard construction 4 bed semi detached, the result cost is £640k. I'm going into town today to talk to an insurance broker to check it's correct

enthusiasticsaver

I am bumping this thread to get it back to the top of the forum and bring back on topic.  

Just checked on here and in 2014 3 years before I retired and 10 years ago I posted on here saying we needed £25k to survive and it was too late to start a SIPP given I only had 3 years before I left work. Oh how things change. 

We in fact did retire in 2016 and 2018 (both 58 years old ) and although the income did not kick in all at the same time and we still are waiting on state pensions we are in the comfortable category when it comes to pension living standards categories. In the end we retired initially on £30k for a couple. Now our income is approx £2500 each per month so £5k in total.  That will increase by around £1k each when our state pensions pay out later on this year and early in 2026. That is a mix of DB pensions, DC pension, SIPP, stocks and shares ISAs. We live comfortably off that and indeed are still saving and we gift a lot so we could survive on a lot less. Our drawdown percentage on SIPPS, stocks and shares ISAs and DC pension is about 4%. 

enthusiasticsaver

Our actual spending in retirement is 

Bills and direct debits (some discretionary spends like gym membership, national trust, amazon prime, netflix, sky etc) £750 per month
Personal spending for both DH and I (£300 each)  Covers clothes, hobbies, personal toiletries etc etc                           £600 per month
Food per month                                                                                                                                                                   £400 per month
Eating out, theatre and other entertainment                                                                                                                        £300 per month
Gifts to family and charity subs and saving for Christmas                                                                                                   £300 per month
Running two cars and fuel                                                                                                                                                   £400 per  month
Household costs and saving for white good replacement                                                                                                   £250 per month
Holidays, short breaks  away                                                                                                                                              £1000 per month
Savings for replacement cars, home improvements, long haul holidays, family gifts.                                                        £1000 per month

It shows the importance of getting the number right.  We live more than comfortably now and in fact could have afforded to retire earlier than we did.  In 2020 and 2021 we took nothing out of the stocks and shares isas due to not   travelling during the pandemic or  going out to theatre/restaurants etc so that also has helped keep the drawdown percentage low.  We will possible reduce or stop the drawdown once the state pensions pay out. Our IFA has done a cashflow up to the age of  99 though so we should be ok. We could manage on a lot less. 

MeteredOut

enthusiasticsaver thanks for that - its really interesting to hear the reality compared to what you thought 10 years ago!

Would you be able to share the split of investments you have over DB Pension, DC Pension, SIPP and stocks and shares? eg, what % does each contribute to your health £5K per month.

Congrats on what you've done - it sounds like you're having a happy and healthy retirement!

enthusiasticsaver

MeteredOut said:

enthusiasticsaver thanks for that - its really interesting to hear the reality compared to what you thought 10 years ago!

Would you be able to share the split of investments you have over DB Pension, DC Pension, SIPP and stocks and shares? eg, what % does each contribute to your health £5K per month.

Congrats on what you've done - it sounds like you're having a happy and healthy retirement!

Thanks for that and yes looking back on my post 10 years ago it is interesting what I thought we would need.  

DB Pensions for us each month are £3500 approx so 70% of our income. 
DHs DB pension is exactly 50% of our total income so £2500 and mine is £1000 as I worked part time to bring up children.  

The other 30% come from a combination of SIPPs, DC pension (mine) and Stocks and Shares ISA (again mainly mine) 

I draw on my Sipp, stocks and shares ISA and DC pension to the tune of £1500 (mainly ISA to minimise tax paid )