How much to live on

BooJewels

@QrizB - I'm still tittering at the idea of unicorn milk enriched loo roll.

@Albermarle - my post made it pretty clear that I was illustrating what my own idea of 'luxury' is - I wasn't claiming it was the nationally accepted definition of a luxury lifestyle.  If anything, using that word in that context by Which is perhaps misleading.  The other list using 'comfortable' is perhaps more appropriate.

MarzipanCrumble

I deliberately worked longer than retirement age in order to have a retirement income which meant I did not have to budget excessively or worry about spend.  The main reason for this was to cut stress (to which I know I am prone).  

SP was deferred (old SP = 10% ish interest) and I worked in a DB pension industry.  I have achieved my aim and, wow, so glad I did, what with inflation, rising prices and increased utility costs.

BUT ... I am very lucky in that I was in a well paid admin job which I liked and had little stress.  I was widowed (advantages and definite disadvantages too from a financial academic viewpoint) and was/am free to live my own lifestyle.

I really, really couldn't contemplate managing on a minimum 12.5K pension.  I admire greatly those that do.

sheilavw

Do you mind me asking Marzipancrumble do you get a bit extra on state pension as you are a widow. My Husband died just over 4 years ago at 59 and someone mentioned that you get a bit extra?

I have gone from 5 days to 4, I am 61, I get a small monthly pension from his DB . I am not sure yet how long I want to carry on working

BooJewels

I can answer that from my own perspective @sheilavw as my circumstances are much the same.  I asked the NI people to look at it for me - I think it perhaps depends on your late husband's age and pension arrangements through work at the time.  But they reported to me that I'd get half of what they called his Protected Payment.  In my case, I'll get what I think is the equivalent of 2 years extra NI contributions - so 2 x £5.82 = £11.64 per week on top of my own state pension.

So it might be worth a chat with the NI department and asking them to investigate for you. I had to authorise them to look at my husband's records and it took about 6 weeks before I got a letter confirming it.

ETA Link:   https://www.gov.uk/new-state-pension/inheriting-or-increasing-state-pension-from-a-spouse-or-civil-partner

Albermarle

sheilavw said:

Do you mind me asking Marzipancrumble do you get a bit extra on state pension as you are a widow. My Husband died just over 4 years ago at 59 and someone mentioned that you get a bit extra?

I have gone from 5 days to 4, I am 61, I get a small monthly pension from his DB . I am not sure yet how long I want to carry on working

As suggested above you can try and contact the govt dept, but it is often difficult to get through.
It maybe easier to start a new thread on the Pensions forum, where there are quite a few experts.
Give as much detail as you can about your situation and your late husbands pension, as often the devil is in the detail with these things.

Pensions, annuities & retirement planning — MoneySavingExpert Forum

sheilavw

Thanks everyone. I am away off yet, but I had heard this mentioned. I think that it is only right, he paid in all his life

MarzipanCrumble

To answer:  Yes, I get a contribution from my late husband's SP as well as 50% of a DB pension of his.

Beaware though, that both SPs are old type and my husband was 9 years older than me, which may have meant the payment of part of his pension may have been more generous than what it would be with 'new' SP.

Albermarle

sheilavw said:

Thanks everyone. I am away off yet, but I had heard this mentioned. I think that it is only right, he paid in all his life

I am afraid that what matters are the 'rules', and not how much has been paid in or for how long, or what is perceived as right or wrong. Like other pension and insurance schemes, the ones who die early pay for the ones who live to a ripe old age.
So you need clarification from someone knowledgeable in this area.

blue.peter

Albermarle said:

I am afraid that what matters are the 'rules', and not how much has been paid in or for how long, or what is perceived as right or wrong.

Also, I'd point out that it's wrong to think in terms of "paying in", since there is no fund into which contributions would go to fund the payer's retirement. Current contributions are used to pay current liabilities. When someone is paying NI contributions, their contributions are immediately spent to pay, inter alia, the state pensions of those who have already retired. They aren't held back for the payer's later retirement.

This is why we're now feeling the effects of what was, 40 years or so ago, called the "demographic time bomb". That bomb has exploded: the ratio of retired people to those who are still working is worsening. There aren't as many people paying NI and funding those who have retired. One consequence is the need to increase SPA, so that fewer people are drawing the state pension. The alternatives would be to require young people to pay unaffordable NI contributions, or cut the state pension.

Albermarle

blue.peter said:

Albermarle said:

I am afraid that what matters are the 'rules', and not how much has been paid in or for how long, or what is perceived as right or wrong.

Also, I'd point out that it's wrong to think in terms of "paying in", since there is no fund into which contributions would go to fund the payer's retirement. Current contributions are used to pay current liabilities. When someone is paying NI contributions, their contributions are immediately spent to pay, inter alia, the state pensions of those who have already retired. They aren't held back for the payer's later retirement.

This is why we're now feeling the effects of what was, 40 years or so ago, called the "demographic time bomb". That bomb has exploded: the ratio of retired people to those who are still working is worsening. There aren't as many people paying NI and funding those who have retired. One consequence is the need to increase SPA, so that fewer people are drawing the state pension. The alternatives would be to require young people to pay unaffordable NI contributions, or cut the state pension.

Yes there is a common misconception that your NI payments over the years go into some huge fund ( and it would be huge!) that pensions are paid out of.
In think in fact NI payments from each year do go into a fund that pays out state pensions, and then any excess is used to supplement NHS budget etc.
So there is actually a NI fund but it is replenished and spent on a yearly basis.