How much do you need to live on?

DesG

Did someone delete the "The Number" thread?

bowlhead99

DesG wrote: »

Did someone delete the "The Number" thread?

It's on the Pensions board, not had any posts this year.
https://forums.moneysavingexpert.com/discussion/2146737

I know whatever my number is going to be in retirement, it's not likely to be what it is now. Lower I hope!

166million

The amount you need just to stay alive is quite low.
I included in mine rent, council tax, gas, electricity, water, food, petrol, etc. (assuming I am working and need car to get to work), cat insurance.

If I didn't need the car I could travel by bicycle wherever I needed to go I guess.If you've paid off you mortgage that would take it even lower.

I mean this is a survivable but not especially desirable way of life.

Archergirl

Wow, there are some very lucky people out there...............

melbury

mgarl10024 wrote: »

My GF and I sat down and totaled up everything we thought that we would need to live a happy 'retirement'. This excludes mortgage etc. but did include a few 'nice things' - a holiday budget, a redecoration budget, etc. etc.
We came to a figure of £12,036.87
I didn't add a contingency to this because I felt there were so many 'nice things' and you probably wouldn't want them all.

This did seem slightly below the figure quoted here: http://www.thisismoney.co.uk/money/pensions/article-2595965/The-key-happy-retirement-A-pension-income-17-000-year.html

Then, assuming that this pot would last indefinitely (and so I'm not burning through the pot each month) and following from here (http://www.mrmoneymustache.com/2012/05/29/how-much-do-i-need-for-retirement/) I came to the below figures.

0.5% £2,407,374.00
1% £1,203,687.00
1.5% £802,458.00
2% £601,843.50
2.5% £481,474.80
3% £401,229.00
3.5% £343,910.57
4% £300,921.75
4.5% £267,486.00
5% £240,737.40
5.5% £218,852.18
6% £200,614.50
6.5% £185,182.62
7% £171,955.29

So, about £300,000 should give me about £12k for life.

Just wondered, does this figure of £12K include the state pension or is it in addition to?

enthusiasticsaver

We are tracking our income at the moment in the 4 year run up to retirement and would be able to manage on £750 -£1000 per month just for essentials as we have no mortgage any more but would prefer to have £1500-£2000 per month so some extra fun money for holidays, weekends away. Our 2014 total pensions forecast at the moment is £32k per annum gross approx and with our lump sums and projected savings at around £200k we should be more than ok

gadgetmind

bowlhead99 wrote: »

you'll see the whole range from 300 to 3000 to 30000 a month if you ask enough people.

Yes, definitely. We're closer to the middle value of that range than the top, and would no more know what to do with £30k pcm than many people would know what to do with our more modest crust.

Humbert_Humbert

There is, as we can see, no one-fits-all number.

I would approach it a slightly different way and ask the question of how much do you need to live on once the bare necessities of life have been taken care of - shelter, food, warmth, etc.

The number may be reasonably high if you feel the 'need' to factor in the running costs of a new-ish German car, multiple exotic holidays, and supporting family financially.

For me, once the housing, utilities and food costs are all paid for - the basics that we all need - I'd be comfortable on, say, £10K per year. Such a figure would allow me to eat better quality food, run a basic car, indulge in a few hobbies and take a moderate holiday at least once a year.

Stubod

12k to live off??.... seems a little low to me..unless you mean 12k each...ideally I would want about 24k (total)

lalman

bowlhead99 wrote: »

Well exactly, you get a whole range of answers which might be interesting to read but are in no way comparable with each others. If you already expect the figures to change significantly with lifestyle and age and so on, then any 'survey' is not really worth reading, because you probably know or can guess that you'll see the whole range from 300 to 3000 to 30000 a month if you ask enough people.

Even the part about "excluding car and mortgage" doesn't help. If you already paid off your mortgage you may divert a lot into savings, or maybe you don't need a lot of savings because you are already secure.?

If you 'need' £5k a year for car running and depreciation, then perhaps it's because you do 20k miles of commuting and social travelling each year and the money is saving you £2k on train travel and £2k on holidays that other people would put in their list as necessities. But perhaps it's just an extravagance, a bit of luxury. Or perhaps you have to spend a certain amount of money on car and smart suits etc to keep up a business image for your high paying job, so it's been built into your salary and if you exclude the care expense from the calculations it looks like you're relatively richer than you are.

I do generally think people feel better about their lives if they don't know where they fit on the bell curve - but the 'total income' vs 'total wealth' curves can be vastly different anyway which makes analysis of one at a time a bit fruitless.
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Although your right as per usual, that's not the point. I want to see perspectives. Some people literally won't accept living on less than 2k PCM but others would find that luxurious... And yes we can't compare people because there are too many variables not factored in

However, this is only abit of fun.... And it's interesting to see the different perspectives that people have and the logical and illogical justification behind it