Is the state pension really that bad?

Pollycat

msallen wrote: »

I would further suggest that it would be wise for them to ....

1) Check their facts
2) Check their spelling/grammar

... before contacting their MP.

I was taking note of this:

Spreadsheetman

My father has lived on the state pension plus a small occupational pension (equal to 1 weeks state pension/month) for a long time quite comfortably. (North East, so low cost of living) He actually saves money from his pension, so has enough to cover the one-off expenses as they arise.

However, he is from the pre-war serious deprivation generation so his wants are very minimal. e.g. no holidays, very plain food, no eating out, no electronics (apart from TV+radio), no smoking, no drinking, no credit cards. He does still drive a small car and have a warm well-insulated house and he's happy with his spartan lifestyle.

I'd struggle to live on his budget, but it is definitely do-able even for a single person.

Ashingtonian

Spreadsheetman wrote: »

My father has lived on the state pension plus a small occupational pension (equal to 1 weeks state pension/month) for a long time quite comfortably. (North East, so low cost of living) He actually saves money from his pension, so has enough to cover the one-off expenses as they arise.

However, he is from the pre-war serious deprivation generation so his wants are very minimal. e.g. no holidays, very plain food, no eating out, no electronics (apart from TV+radio), no smoking, no drinking, no credit cards. He does still drive a small car and have a warm well-insulated house and he's happy with his spartan lifestyle.

I'd struggle to live on his budget, but it is definitely do-able even for a single person.

Sounds like me in the future, except swap the car for beer:beer:

molerat

The only problem we have for when we both reach SRA is what to do with the extra £900 pm net more than we currently live on

Thrugelmir

Always worth putting numbers into context. Regarding the level of Spanish state pension.

Spanish State Pension system about to go Bankrupt?
By Chris Burke - Topics: Barcelona, Pensions, Retirement, spain

During 2017 or early in 2018, the Spanish State Pension system is due to run out of money. At one point, the reserve fund the government created for this was standing at 66 million Euros.
Why has this happened?
During the crisis, millions of jobs were lost, and with them, an almost parallel reduction in contributions to the Social Security. Furthermore, a large part of the new jobs are precarious – temporary, part-time or free-lance – and with low salaries. This means that contributions to the system are way below expectations and the minimum required for it to be able to meet outgoings with incomings.
While this has been happening, payments to retirees have been increasing. In the last 11 years the number of actual pensioners has increased by over a million (8.3 million up to 9.4 million). The average pension amount paid out has also increased, from €647 per month to €906 from 2006 to 2016. In 2007, 79 billion Euros was paid out in pensions, compared to 117 billion in 2016, an increase of 48%. In real terms, the annual deficit for the year is 19 billion Euros.
This issue of funding pensions is made even harder by the lack of people in employment. In many European countries it’s normal for 50% of the population to be in work, in Spain it’s only 40%.
Ideas on how to solve the problems being explored
These range from not putting a cap on contributions (this would generate more income in the short term, but mean more pensions payable in the long run). A more popular idea is to allow those people retired to still work and receive their entire pension, which would generate increased state contributions. Gaining more support is the change to stop those who are not contributing to the system to not receive state pensions/handout, such as widows and orphans. These would instead be funded from current tax revenues.
In essence Spain may have to look at what many other countries are changing, such as making people contribute for more years and lower percentages to effectively cut the average pension payments. As well as increasing Social Security contributions. But what does remain clear is, if you are ONLY relying on the state to fund your retirement, you could be looking at grave consequences.

[Deleted User]

thorsoak wrote: »

I am in reciept of DWP pension of £655 per 4 weeks, and a private pension of £110 per month. No mortgage - and apart from 25% council tax discount, I receive no additional benefit.

I have no mortgage to pay but I find that I can survive on my pensions - but cannot really factor in such things as I might wish to do on a regular basis - such as yoga classes, u3a etc. You might need to think about that whilst you can.

That is key for me.


I don't want to survive I want to live. I view any state pension as an added extra and don't even think about it in my pension planning.


Yes you may be able to pay the necessities but in retirement as annual leave I spend an awful lot more money because I have the time to do things and I don't want to worry about whether I can visit the garden centre but not afford a pot plant or refuse a weekend away etc etc.


State Pension is to exist not live IMO.

NineDeuce

Like with most issues today, the OP uses one example, in this case his/her own, to generalise about a massive subject.

It's like the pompous section of homeowners who use their own fortune, luck or particular circumstances to preach about deride other people for not being able to afford their own home.

enthusiasticsaver

Surely we all know we will be retiring one day so it is our responsibility to put plans in place in much the same way as planning for buying a home or a car or a child?

We have been told for as long as I can remember that the state pension alone will only provide very basic subsistence level. Consequently we concentrated our efforts on saving for retirement on our investments/sipps and occupational pensions and the state pension is just something extra.

I realise others are not so fortunate and we have not had periods of unemployment or illness during our working lives to contend with but I would say we made a certain level of sacrifice and financial discipline in aiming to save an average of 10%(sometimes up to 25%) of our income specifically for retirement for the best part of 25 -30 years before being confident to take voluntary early retirement at a date convenient to us and a lot earlier than the state would like.