Comfort Pension Level

grey_gym_sock

Freecall wrote: »

I take it you live in or near a town.

as do most of the UK population.

atush

I don't. But I hope to live closer or in one when retired.

PasturesNew

wary wrote: »

Excellent! So you'll be living your retirement in style. I mean how many of us can afford to have our own Jacuzzi ...

Well ... to be honest, at my income level most people don't even get the luxury of a bath; you get a small shower in a miniscule shower room ... tiny places..... so I'll have to take is read that [a] you've got a jacuzzi to have mentioned it you fart in the bath.

Gross.....

Goldiegirl

In my earlier post, I mentioned my plans for retirement next year.

In order to make sure our plans are workable, this year we are living within a 'post-retirement' budget, and saving our surplus income. I've made certain adjustments, to take into account expenses we have in our working life, such as petrol for travel to work, and the upkeep of our second car.

I've made amendments to our average monthly expenditure, such as doing more cooking from scratch, which has reduced grocery expenditure. But I'm still shopping at the same supermarket that I always have done. I have more clothes than I could possibly ever wear, so we have no need to buy lots of clothes just for the sake of it

But we've had days out, trips to the theatre, meals out, a weekend break and the odd coffee here and there. Not to mention still having Sky TV

All this is on our projected post retirement income of 17500 per annum from spring next year, until October 2016 when my husbands other pensions kick in. (My current pension is index linked, my husband's is fixed. His pensions from Oct 2016 will be index linked)

Of course, I have the security of savings behind me, and a house that I could downsize as well.

Although we won't be living lavishly, we won't be living frugally either.

On the subject of motoring, we will go down to one car when we stop working. At the moment we do't do 12000 miles between us while we are working - our mileage in retirement will be way lower than that.

wary

PasturesNew wrote: »

Well ... to be honest, at my income level most people don't even get the luxury of a bath; you get a small shower in a miniscule shower room ... tiny places..... so I'll have to take is read that [a] you've got a jacuzzi to have mentioned it you fart in the bath.

Gross.....

I "mentioned" it not because I have one but I assumed that with all of those beans you eat ... well, you know ... Obviously it was wrong of me to even assume that you have a bath, so please accept my apologies.

PeacefulWaters

I've just been trying to work out my budget in retirement in today's terms and felt comfortable with a gross income of £16k for me and £8.5k for Mrs PW (both indexed). Own home, no mortgage and running a car and taking two holidays a year. Replacing one item of kitchen equipment each year and building up a reserve to cover the boiler replacement or subsidence excess if ever needed.

Lower tax, no national insurance and no deductions from wage to pay for pensions, share schemes, healthcare, no mortgage, no fuel to/from work, no beer after work and the like make your current income much closer to your retirement income than you realise.

It's a bit tighter once one of us croaks.

As for PasturesNew, I can see how an individual can live on the universal pension if their rent is paid by Housing Benefit. It's certainly doable.

eastcorkram

PeacefulWaters wrote: »

I've just been trying to work out my budget in retirement in today's terms and felt comfortable with a gross income of £16k for me and £8.5k for Mrs PW (both indexed). Own home, no mortgage and running a car and taking two holidays a year. Replacing one item of kitchen equipment each year and building up a reserve to cover the boiler replacement or subsidence excess if ever needed.

Lower tax, no national insurance and no deductions from wage to pay for pensions, share schemes, healthcare, no mortgage, no fuel to/from work, no beer after work and the like make your current income much closer to your retirement income than you realise.

As for PasturesNew, I can see how an individual can live on the universal pension if their rent is paid by Housing Benefit. It's certainly doable.

this post makes my plans look better

I won't be taking any holidays. Don't have a boiler (no gas). And certainly can't imagine needing to replace one kitchen appliance a year.

atush

PasturesNew wrote: »

Well, I've never had a good salary so used to slumming it .... never had a job with a pension, not earned enough to pay into one - and 'advice' says that if you're not a higher rate taxpayer and employer doesn't pay in then there's not much point.

In your case there is EVERY point in starting a pension. AS you wont probably get the full new SP as if you are SE ( I assume you are as you said you never had a job with a pension and jobs now have to come with one or will very soon) you wont have any S2P.


And even if you did get the full new SP you still have room left in your Personal allowance. So everything you put into your pension (and remember every 80 you put in becomes 100 even w/o an employers contrib) will be tax free when you take it out. As you can take 25% TF when you start, and if you DD only 3.5K or so eahc year you wont pay a penny in tax.

The blithe advice a pension is only good if you pay higher rate tax or have employers contribs isn't actually true for one like you on the lower end of the pay scale. Esp as many benefits will no longer be around when the new SP comes in like pension credit.

PasturesNew

atush wrote: »

if you DD only 3.5K or so each year

I've never had a job that had that much/year to live on after the basics were covered..... right now that's about my total annual income in fact, before I pay anything!

I'm not working right now ... and am registered SE, but will be looking for a job later this year as SE income fell off a cliff.

I've not many years left... I'm no spring chicken! If I HAD anything to save, there's no benefit in doing so unless I live to be 100.... which is unlikely.

I'd just sell my house and move into a small/final home if I needed more cash. Not buying a big house now, but there's certainly smaller around ... in those OAP places.

atush

Those OAP places can be expensive.


But anyway, do you earn more than the SP now? If you dont then you can live on it I guess.

But if you are earning over 10K then you will fall short and could benefit from saving whatever you can now. And into a pension to boost it. As you can take the whole pot when you retire, no need to live to 100.