Restoration of the age related allowance

jamesd

Jennifer_Jane wrote: »

It is facile to simply say, as jamesd implied, that there are no other costs to accommodation if you don't have a mortgage.

jamesd wrote: »

Far more pensioners own their homes outright so no longer have a mortgage to pay. ... lower housing costs

I was quite explicit that costs were merely lower, not zero. Buildings do need to be maintained and Council Tax has to be paid even if there's no mortgage.

Thrugelmir wrote: »

Do they? Only 62% of all property is owner occupied. That figure includes mortgaged property.

The FRS figure is 68% of households living in a property that is owned outright or with a mortgage. But that's households, not properties, so some difference between the two wouldn't be surprising.

Ainsley1

I just wonder, of the posters on this thread, how many would be happy to retire on 60% of the average wage (= about £15K) and then have to pay tax on it. Many pensioners do not get that. Let me do a back of fag packet calculation (no I do not smoke as well!) for what I feel I need:

Assume some very conservative figures:
1000 on council tax
1000 on energy
£200 for buildings and contents insurance
£1500 car depreciation
£500 on fuel
£175 car tax
£200 car insurance
£200 for MOT, spares and servicing ( I get good value at the back street garage, shh, don't tell everyone!)
(OK these might not be considered essential but where I live the bus fares and taxis fares would be equivalent given our hospital/decent supermarkets etc. is over 20 miles away)
£1000 House maintenance (decorator and repairs - not fit to do DIY anymore... and that was always hubby's province)
£200 allowance for white goods replacement
-that's £5975 so far (so that's the state pension gone and the rest)
£250 Phone (landline)
£145 TV Licence
£250 for Gardening (grow own veg to keep costs down)
£500 to replace worn out seats/carpets/table/curtains/bed/mattress/linen/towels
Oh I forgot to eat and drink say £50 per week..that' another
£2600 (no meals out for us pensioners eh?)
and then a few prescriptions
£100 (good job the NHS is free)
£500 Dental insurance cos they're not free
£500 Cleaning material/toiletries (Thank God for the menopause!)
£50 haircuts - I just go twice a year now to the hairdressers ( a neighbour gives me a tidy up in between) but everyone thinks I look like a down and out
£300 clothing renewal and shoes
£50 allowance for PC - so I can make sure I get all the best deals and bank on line now I am not so fit
(I've now reached the level that is

a pensioner couple’s typical weekly spending on essentials, according to the Office for National Statistics

Good job I'm a widow!
£250 For Christmas presents for the family (sorry that's just £50 each and that includes your Birthdays and cards to long lost friends). I don't bother with a tree and decorations anymore
Oh I missed a bit due to my failing sight...
£100 for checks and spectacles
£250 for a daily/weekend newspaper, I like to keep in touch (It's how much a year???)
Can I afford a hobby? It's not going to be golf but I enjoy photography and I already have an elderly digital camera so that just for printing...
£100 will do me handsomely for the pictures
£250 for the over 50's swimming session (Doc says that's best for me to stop Osteoporosis and keep fit!)
mmm If I spend anymore I'll need to make sure my extra savings income and husband superannuation (I get half of what he would have done if that war wound had not done for him five years ago) brings me up to £13,000 per annum. So that's, state £5560, superann, £5000 that leaves me 2430 to get from my savings pot so I need (if I can get 4%) to have saved over £60000.
Good job we scrimped and saved all those year to buy our little house.
Better forget about any holidays, days out and treats; and to think we had to live off rations for the first 10 years of my life!

Oh dear. Can anybody lend me a tenner till next week?

teajug

Good post... it is more difficult when a pensioner lives on their own, when I had a mortgage I found that the roof was the biggest problem when employing builders to do repairs. What was the point in putting myself through all that hardship to maintaining a property, it was OK when I was young and agile, but not when you get older and have aged related conditions which some are more prone to than others but few escape them.

I rent now as the cost of maintaining a property was too much for me and did not want to move to another area away from the few friends that are still around.

Pensioners that live alone have to pay 75% of council tax, I think that is not fair as it should be 50% or should be based on income.

There used to be centres that elderly people could use free during the day time but have closed down now or pensioners are being asked to pay to use them and of course that is out of the question for some pensioners. Therefore so much for keeping fit and active while you can and save the NHS, but the councils want their money coming into them.

If you own your own property and not able to look after yourself, you will may end up giving it all to a private care home owner or the council for the privilege of being lock up in a care home if you got dementia and if you are unable look after yourself or walk unaided you will not get outside these places either if all your friends and family are not around to look out for you while you are there and if you are lucky you will not be subjected to abuse that we all know goes on in these places.

Therefore my advice is use whatever resources you have to keep healthy and fit as long as possible and hope that you die in your sleep before you lose your faculties or mobility and have to go into one of the dreadful care home that maybe waiting for you.

jamesd

Ainsley1 wrote: »

I just wonder, of the posters on this thread, how many would be happy to retire on 60% of the average wage (= about £15K) and then have to pay tax on it.

Happy to, I've done it on around £12k of spending (so after tax) and paid £425 a month rent out of it for several years recently. No absolute need for me to do that, I just chose to so I could save more for (early) retirement and contingency long term unemployment provision.

MonkeyMad

Car depreciation isn't an expense, it is a devaluation of already spent money so you can remove £1500 from your budget there. You could replace it with an amount to save to replace the car you have if necessary (you could buy a different car every year for £500).

Jennifer_Jane

Wonderful post, Ainsley1, thank you so much for going to so much trouble. I was battling to get my little point across about housing costs not being just about maintenance.

MonkeyMad - I agree about the depreciation cost per se, but you still do need to save for the next car, and NO, £500 cars are not recommended - then your repair costs are as bad as the depreciation as the car does have to be roadworthy (ie MOT'd in this country). So best to buy the newest (ie low-maintenance) car you can, especially when the interest rates are so low, and save monthly for the next. If I can generalise, older people don't like changing things, making their lives complicated, by chopping* (sic) and changing £500 cars every year. We've enough to worry about with our deteriorating health (especially teeth and eyes), and deteriorating houses!

*having once bought a car when I was being made redundant one time which was two different car halves put together.

jamesd - I also did this, partly as practice for the retirement years, but also to save AC's so that this money was added to my lump sum and was consequently tax-deductible from salary and tax-free on retirement. I'm sure you would approve.

Mrs_Arcanum

It really is not an us and them situation.

This could be turned on its head by saying pre pension aged families have children, mortgage, full council tax, prescriptions, pension, child care, bus fares all in addition to the expenses of a pensioner and start to pay tax on more of their earnings earlier. Oh and none of the other discounts those of pension age are entitled to.

Funny how both my pensioner brother & MiL choose to still afford to smoke!

All that has happened is the older persons tax allowance has been frozen until the standard rate catches up.

MonkeyMad

Jennifer_Jane wrote: »

MonkeyMad - I agree about the depreciation cost per se, but you still do need to save for the next car, and NO, £500 cars are not recommended - then your repair costs are as bad as the depreciation as the car does have to be roadworthy (ie MOT'd in this country).

But to be fair a £1500 Toyota or Honda or any other modern car about 10 years old is not going to cost £1500 year on year to run. You can get a replacement engine for less than that. Entire set of discs and pads £400. I have had a succession of old cheap cars that have never cost anything like £1500 or even £500/ a year to buy and maintain and that includes the MOT. This has included thing like getting the air-con fixed which is hardly a necessity. and I change them every 4 or 5 years when I fancy a change not because they are broken. And no, I don't do any work myself except changing the lightbulbs.

You may choose to buy new cars because you believe they are more reliable, but I doubt if there is real evidence to suggest that any reasonable condition car around £1500 will cost the same again to run year on year.

Ainsley1

Happy to, I've done it on around £12k of spending (so after tax) and paid £425 a month rent out of it for several years recently. No absolute need for me to do that, I just chose to so I could save more for (early) retirement and contingency long term unemployment provision.

Great James. I applaud your spirit and sticking to your choice!, but I think the key there is 'choice' 'save more' and 'contingency'.

Do you think that you would feel the same if you were elderly (I assume you are not!), you had no choice, had nothing left to save and therefore had no contingency for that rainy day?

Anybody else (irrespective of age or pension status) choose that level of income?

Thrugelmir

The fact that even a car is considered a basic essential of retirement shows how much has changed in more recent years.

Although years from retirement. My current property was bought on the premise of cutting motoring costs.

The saving I should add has been injected into my pension plan.