BBC: Home owners risk retirement poverty

debtistheft

Loughton_Monkey wrote: »

Quite a feat for someone who joined the forum this month.

You think in such three-dimensional terms. How small you've become.

Conrad

Well I can assure everyone that the pensionless / lessor pension folk I meet, from all different societal strata, tend to DOWNSIZE at returment and release large sums that way.

Incidentaly for 20 years I've heard these regular bulletins, and always somewhere in the mix is a survey done by the Pru or other pension provider. These surveys universaly fail to ask the down sizing question and automatically exclude such wealth. They also fail to ask about other property assets, laughable really.

I was quite surprised to learn My folks are getting some £800 pm from the state alone (the basic OAP and SERPS), let alone the downsize equity and private pensions.

debtistheft

Conrad wrote: »

Well I can assure everyone that the pensionless / lessor pension folk I meet, from all different societal strata, tend to DOWNSIZE at returment and release large sums that way.

Incidentaly for 20 years I've heard these regular bulletins, and always somewhere in the mix is a survey done by the Pru or other pension provider. These surveys universaly fail to ask the down sizing question and automatically exclude such wealth. They also fail to ask about other property assets, laughable really.

I was quite surprised to learn My folks are getting some £800 pm from the state alone (the basic OAP and SERPS), let alone the downsize equity and private pensions.

Its shocking how many home owners think they can downsize. How often have we heard the rather terse refrain "My house is my pension" and yet fail to see that downsizing from a 3 bed family home to a 2 bed retirement home doesn't actually release that much money, especially after the estate agents and other property leeches have had their cut.

£800 per month is a laughable amount when you look at how it is reduced by tax, council tax, property insurances and all the other mirriad of outgoings we all have regardless of whether we are workng or not. We don't have to pay for commuting when we retire but we do pay higher utility costs. People think it's cheap top be retired. Its not, unless you want to be miserable.

Thrugelmir

debtistheft wrote: »

£800 per month is a laughable amount when you look at how it is reduced by tax,

Over 65's each a tax free personal allowance of £828 per month. (£9,940 per annum).

So saving towards a pension, however small can be beneficial.

chucky

i'm starting to think that all those mortgage free pensioners living in anything bigger than a 2 bed should be forced to sell their property.

it will be a good way to prevent property being a scarce resource.

Prudent

I did the mortgage free in two years bit. I have no regrets. It was for a short time only. As I now have no mortgage to pay, I can afford both an occupational and a private pension. I am also not clear why I will be worse off in retirement. To rent a similar property would cost me £600 a month. I keep annual budgets of maintenence and repairs and even allowing for fitting new bathroom, kitchens, windows etc my house has cost me nowhere near £600 a month since I bought it in 2002. I do not believe home ownership has had any adverse effects and my pension.

Prudent

debtistheft wrote: »

£800 per month is a laughable amount when you look at how it is reduced by tax, council tax, property insurances and all the other mirriad of outgoings we all have regardless of whether we are workng or not. We don't have to pay for commuting when we retire but we do pay higher utility costs. People think it's cheap top be retired. Its not, unless you want to be miserable.

I could live on that. I have kept a record of my spending for the past for years. Over that time I have lived on an average of £847 a month for everything. I spend £150 on pretrol my commute and more on wear and tear of the car. I have just come through the expensive years with my dd who is now 19 within that budget, so it has provided for two of us. It has surprisingly provided well - supplemented with some rather nice treats from comp wins which I can continue to do in retirement. I would hop what I save on my commute would offset extra heating and social activties.

ukcarper

debtistheft wrote: »

Its shocking how many home owners think they can downsize. How often have we heard the rather terse refrain "My house is my pension" and yet fail to see that downsizing from a 3 bed family home to a 2 bed retirement home doesn't actually release that much money, especially after the estate agents and other property leeches have had their cut.

£800 per month is a laughable amount when you look at how it is reduced by tax, council tax, property insurances and all the other mirriad of outgoings we all have regardless of whether we are workng or not. We don't have to pay for commuting when we retire but we do pay higher utility costs. People think it's cheap top be retired. Its not, unless you want to be miserable.

Quite happily living on not much more than £800 a month. I don't think my utility costs have increased since I retired.

Loughton_Monkey

debtistheft wrote: »

Its shocking how many home owners think they can downsize...

A legitimate comment. Often overplayed. But in many cases, like my own, there is a huge value in the house primarily because of location (underground to the City) and Schools - where they will pay tens of £thousands to belong to the 4wd brigade who create complete mayhem around here 3 p.m. to 4:30 p.m

Ironically, we have no children and when I worked in the City, I drove.

But it means we can downsize when the garden gets too much for Mrs Loughton Monkey and release 30% by going to an exact similar house in the sticks. But will release 40%/45% net by actually downsizing a bit as well.

This was a deliberate part of retirement calculations, although not required until age 79 - although if I get that old, it will be a miracle what with all the cigars and gin & tonic.

ukcarper

chucky wrote: »

i'm starting to think that all those mortgage free pensioners living in anything bigger than a 2 bed should be forced to sell their property.

it will be a good way to prevent property being a scarce resource.

Might be a good idea because if property drops as much as some of the bears want no one will be downsizing voluntarily.