The cost of living

coyrls

Just be aware that some posters are not including any spending from their savings as part of their income requirement. If you follow that approach, you can get to some low but unrealistic figures.

atush

westv wrote: »

Any budget that didn't allow for two overseas holidays a year just wouldn't float my boat but that's just me.

No, it isnt just you- its me too. 2 holidays per year Min.

All those who can live on 12K a year I salute you. WE will work on until we can live on over 60K thanks lol.

Of course we dont live in a holiday area like Cornwall with mild temps and good places to eat. Nice shops etc. WE have to go away for that. WE also dont have great public transport.

We will spend 6K per year on food and household stuff plus wine. As there are no pubs close by, and taxis arent cheap.

atush

fatbeetle wrote: »

Thanks very much for your thoughts guys. As we currently live in Aus it's hard to get a reasonable picture of what we need. We'd rather retire earlier than hang on in there just to have a few bob extra a month, but also would like a reasonable standard of living. (This forum is going to be a godsend in minimising outlay!)

We're happy to holiday in Devon and Cornwall, but will want a biannual trip back to Aus to see our daughter.

Our hobbies are walking and photography, as as we have all the kit, the outlay for those is minimal, petrol basically. We'd like gym membership, but may set up a home gym which will pay for it'self in the long run.

Any more thoughts or info needed, please fire away

Thanks

Thom

I know your wife wont have one, but what is your UK state pension looking like? Do you have at least 10 years (incl 3 from 16-18) contributions? If not, it might be worth paying voluntary contribs to get up to that level.

westv

coyrls wrote: »

Just be aware that some posters are not including any spending from their savings as part of their income requirement. If you follow that approach, you can get to some low but unrealistic figures.

It doesn't make sense to me either. It's all money spent wherever it comes from.

coyrls

westv wrote: »

It doesn't make sense to me either. It's all money spent wherever it comes from.

When a poster excludes the cost for them of buying a new car, you know that the monthly figure they quote must be too low.

saver861

coyrls wrote: »

When a poster excludes the cost for them of buying a new car, you know that the monthly figure they quote must be too low.

I think you need to work out what the basic/general necessity costs are such as food, utilities, etc. That's the minimum needed to get by effectively with just a few meals out, maybe one budget holiday etc.

From there then there is a need to calculate an amount for replacements, (washing machine etc), repairs, (roof, fences etc), good holidays, car replacement (depreciation) etc etc

Location will impact but that should be accounted for as part of the calculations.

MSE has a budget calculator that is useful to give you a good indication of what your ongoing costs are. See http://www.moneysavingexpert.com/banking/Budget-planning

Our figure is in the region of £20k per year or around £1,700 per month. However, that is without car replacement, big holidays, repairs or kitchen utilities replacement.

I think it is easy to work out a cost using the various utility bills etc and forget about the big ticket items. This will give a very misleading figure overall.

Goldiegirl

coyrls wrote: »

When a poster excludes the cost for them of buying a new car, you know that the monthly figure they quote must be too low.

I think you are talking about me.


We bought the car out of our savings, and intend to keep the car for at least 15 years. Our previous car was bought from new and we kept that one for 13 years.


We have no interest in upgrading the car every couple of years. We regard it as a means of transport, not an asset for resale.


The money has been spent, and we don't care that the car is going to depreciate in value. We're not going to sell it in the foreseeable future, so why worry about it Once you start going down that route, then surely you have to start worrying about depreciation on lots of other things, like televisions and other electrical goods.


Costs such as servicing, insurance and tax are met from our current income.


We've saved all our lives for retirement - and it has always been our intention to buy some of the 'big ticket' items from our savings.


When the time comes, if we want another new car, we'll buy one, from our savings.


With respect, you don't know how much we have in our savings, but it's more than enough, and we'll be adding to our savings from October - we don't have to have two cruises a year!!


Cars don't HAVE to be bought from income, that's what a lifetime's savings are there for


Furthermore, I did say that I wouldn't be comfortable with the prospect of an income of just £18500, with no increases when we get our state pensions, and no savings. £18500 and nothing else is a 'getting by' level

saver861

Goldiegirl wrote: »

The money has been spent, and we don't care that the car is going to depreciate in value. We're not going to sell it in the foreseeable future, so why worry about it Once you start going down that route, then surely you have to start worrying about depreciation on lots of other things, like televisions and other electrical goods.


Costs such as servicing, insurance and tax are met from our current income.


We've saved all our lives for retirement - and it has always been our intention to buy some of the 'big ticket' items from our savings.

I'm not sure it makes any difference where the money comes from - either savings or income.

If you are costing out the cost of living for your personal circumstances you would need to include all costs. So a car costing say £20,000 new and kept for 15 years would be have lost about 95% of it value i.e. about £1,200 per year.

Similarly, replacement items such as washing machine, TV, Fridge Freezer, Cooker, Computer etc etc would have an average life of about 5 years. If you add up the cost of all those items you would probably get a total between £3k and £4k. This £3,500 for 5 years would be around £700 per year.

So with replacement domestic products and car depreciation that gives a total of around £2,000 per year. It has to be paid for, (thus added to the cost of living) regardless of whether it comes out of income or savings.

Then there are house repairs / replacements - e.g. double glazing would have a life span of 10 -15 years. So someone around 55 years of age putting in double glazing today could expect to replace it again at least once in their lifetime. All has to be factored in.

borkid

jamesd wrote: »

The median average income for retired households in the UK is about £18,000. Without car and lots of eating out or holidays £12,000 should be sufficient.

Some ideas for some possible core annual costs in that area, erring on the high side, would be:

£2000 Food and household consumables, much less is possible £5200
£1500 Council tax (property tax) £2200
£1200 Gas & electricity oil and electricity about £900
£600 Water about £360
£350 Property insurance Just renewed £167
£146 TV license
£200-400 30-150 megabit/s internet All phone + internet ( unlimited 78M) £510
£170 basic Android mobile phone and low data use package, unlimited texts, limited included calls
£150 Landline phone

£500-900 cable or satellite for extra TV stations beyond broadcast depending on source and channel selection

Just to give you my figures in red. We are lucky in that we have 2 final salary pensions as well as the basic state pension. I'll also add hubby isn't that careful what he spends ( he used to be but as he says it's rainy day time) so I could shave quite a bit off those figures.

HappyMJ

saver861 wrote: »

I'm not sure it makes any difference where the money comes from - either savings or income.

If you are costing out the cost of living for your personal circumstances you would need to include all costs. So a car costing say £20,000 new and kept for 15 years would be have lost about 95% of it value i.e. about £1,200 per year.

Similarly, replacement items such as washing machine, TV, Fridge Freezer, Cooker, Computer etc etc would have an average life of about 5 years. If you add up the cost of all those items you would probably get a total between £3k and £4k. This £3,500 for 5 years would be around £700 per year.

So with replacement domestic products and car depreciation that gives a total of around £2,000 per year. It has to be paid for, (thus added to the cost of living) regardless of whether it comes out of income or savings.

Then there are house repairs / replacements - e.g. double glazing would have a life span of 10 -15 years. So someone around 55 years of age putting in double glazing today could expect to replace it again at least once in their lifetime. All has to be factored in.

You make it sound very expensive to live in a property that you own.

I rent my property and very few of those costs are mine to bear.

The only one of those that I pay out for is a replacement laptop which so far has been around £600 every 5 years. I put £10 aside every month for it's eventual replacement.

The TV was free. The washing machine, dryer, cooker, fridge and freezer are all included in the rent. The building maintenance is also included in the rent.