How much to live on

helensbiggestfan

My pleasure.  

Just waiting for my mechanic.  My ancient but very reliable Ford Fiesta just sailed through it's MOT, with just an advisory to replace all 4 tyres.  He has found me some almost new alloys with plenty of wear in the tyres.  £120. Cheaper than a set of new tyres.  

Just pimping my ride.....😂🤣

Phossy

helensbiggestfan said:

  

I think we need to take those retirement surveys which say you need X, Y, or Z with a generous pinch of salt.  They are only averages and who wants to be average 😂.  I too think they might be scaring some wannabe retirees off.  

They are not averages - the sample size is 135 people and not all of them are retired. It would be laughable if it wasn't for it getting some much publicity and discussion. The more I see of the detail and the quality of the 'research' the more angry I am getting. I do not see this is helping people - just worrying them. 

helensbiggestfan

Good Lord, a sample size of 135.  Crazy.  

 You're right, I bet quite a few people see these figures and get spooked.  

kimwp

helensbiggestfan said:

hi Everyone.  Not posted for a while but in response to Barons request......

My total pension income is just shy of £15k, with a slight rise in SSP due in April.  I live simply but well, I really lack for nothing.  

I sold my house and am currently in rented whilst house hunting.  The "house money" is invested in various easy access accounts, giving me around 5% which just about covers the rent so that £15k is plenty for my needs.   My next home will be mortgage free so again the £15k income will be just fine.  

My biggest expense this last year or so has been dental implants.....about the equivalent of a new roof. 😱😂.   

I think we need to take those retirement surveys which say you need X, Y, or Z with a generous pinch of salt.  They are only averages and who wants to be average 😂.  I too think they might be scaring some wannabe retirees off.  

Tips and advice........

1.   The most important,  Look after your health. Do your best to stay fit, strong and healthy for as long as possible.  Health is wealth, getting sick costs money. The more you can do to remain active and independent the better. Dont skimp on healthy nutritious food and keep moving. You don't need to join a fancy gym, walking is free, small hand weights for strength training won't break the bank.  Swimming, dancing, local exercise classes such as yoga, Pilates etc are usually inexpensive.  

2.    Remember the old adage.......buy cheap, buy twice - clothes, furniture, equipment etc.  invest in quality.  Better to buy high quality preloved than cheap tat.  

3.    Learn a few simple DIY skills.  Invest in a few power tools to help make gardening and diy easier.  

4.     Declutter so you can keep your house clean and tidy yourself and avoid having to employ a cleaner.  

Can't think of anything else offhand.  

I would just re-iterate that you don't need a fortune to live well. Hobbies and travel can be as cheap or as expensive as you make it.  Some hobbies can be turned into a nice little side hustle and make money.  

This is great, I'm going to copy it to my pension planning spreadsheet!

I currently spend just shy of £13k on bills and life and save £4-5k, most of which goes into a LISA. My aim in retirement is to maintain my current lifestyle which is doing whatever I want to make me happy. Part of this is knowing that I can double my income by reducing pension contributions and I do wonder if I would feel as relaxed about money if I didn't have that safety net.

helensbiggestfan

Kim......glad you found it helpful.  

I meant to add to the list, gadgets and gizmos that make life easier.   Obviously these will vary from person to person, but the right gadget or tool can make all the difference in maintaining independence.  For example I have just bought one of those battery operated electric scrubbing brush thingies.  Makes light work of cleaning grungy tiles etc, also things like long handled feather dusters for high ceilings and hard to reach corners.  Simple things that just make life easier and which mean I can still do my own cleaning.  

One thing I have found is that my money does go further in retirement, probably because I have more time.  Time to shop more carefully, cook from scratch, time to plan ahead. 

There will be no work related expenses, travel costs, clothes, lunches and snacks, work socialising, gifts and collections, guilt presents for loved ones,  less money wasted on takeaways and convenience foods because we are too tired to cook.  

Obviously some things will cost more, such as heating your house because you will probably spend more time at home, so anything you can do to make your house more energy efficient and comfortable is a worthwhile investment.  

Anyway you sound well organised and on track.  I'm sure you will love the total freedom of being retired.  

 

BooJewels

I started a post earlier this morning, but replies since have made it less relevant.  I've said here before that what you can live on in retirement will be very personal to each individual - what would be a deal breaker for one person, won't even feature for someone else.  And as just mentioned it will make a massive difference whether you own your own home or still need to pay rent etc.

You need to list your own requirements (maybe as essential/unavoidable, desirable, contingencies etc.) and project forwards with inflationary increases and align this with whatever income you'll have - applying futurechanges where these can be foreseen or guessed.

I did some planning and budgeting a couple of years ago when I lost my husband and knew I'd be getting his pension lump sum and some life insurance.  A number of things changed and I found my figures were way off (to my benefit - interest rates increased amongst other things) and I've therefore had to re-work them a number of times.  I'm a bit different from most in that I now have capital which earns me interest, but no future pension other than [hopefully full] SP, with a bit extra from my late husband's protected payment.  I'm officially self employed, which brings a little in, but as I broke my leg in December I've temporarily suspended that until I can work more easily.

I started over in my calculations from June last year when I received an inheritance that was rather more than I might have expected and what I've done is work out what I spend now - as outlined above, with inflation etc. to get annual figures going forwards.  Plus I receive interest on the money I have in savings, fixes etc. and I've allowed a sum for those on both a diminishing rate of interest and a reduction in the saved principle - to give me rough headline figures of what I will spend, versus what I'll have coming in in forthcoming years - this gives me a 'net decrease in my available funds' figure for the next few years.  I get my SP in about 3 years, so I've planned ahead on the basis above for 2 years after that.  It'll probably need a re-work before then anyway.

I ended 2023 over £8k up on my projected numbers, so I also now have an additional buffer going forwards, plus I'm already ahead on 2024.  I think this is down to my personal inflation not being as high as I'd allowed and interest rates staying up longer than I'd [deliberately pessimistically] forecast.  

I think/feel that I live comfortably - but that's very much a personal perception - and by spending a lot less than those published figures - but I own my own home.  I give myself a monthly budget to live on and have assorted pots that I put funds into for specific tasks - for example, any Premium Bond wins go into a savings account specifically for holidays, interest from a couple of smaller fixes goes into a saver to create a fund for my summer garden planting, which once I've paid out this year, will become my Christmas fund for the second half of the year etc.  I like to be organised with my finances and enjoy the process of managing it.

Albermarle

[Deleted User] said:

I have just read the article on the BBC website. To be honest I find some of the figures unbelievable. To say a single person needs over £43000 a year to be comfortable! Lots of families have to get by on that or less! Crazy.

Lots of families live on less than £43K, but I guess not very comfortably, if they have children and a mortgage.

These figures have been debated to death before ( and are currently still being on the Savings forum) and everybody has a different idea of what comfortable etc means.

In the alternative similar Which report they call it a luxury rather than a comfortable retirement. However a proper luxury retirement ( multi bed large home in nice area, 2nd home in Cornwall, apartment in Bahamas, 3 or 4 large top end cars, big yacht, MIchelin * eating out etc ) would cost many times the figures mentioned in either report.

So I would ignore the descriptions and just use them as a kind of rough guideline at best.

linz

@helensbiggestfan thankyou so much for the insight! I'm 48 (feel a bit cheeky being on an over-50's board ) but knowing how much I will need in retirement is something i'm now starting to think about so your insight is a great help. Going back into lurker-mode now 

MarzipanCrumble

Would anybody be interested in why a pensioner is in the higher tax bracket?

kimwp

linz said:

@helensbiggestfan thankyou so much for the insight! I'm 48 (feel a bit cheeky being on an over-50's board ) but knowing how much I will need in retirement is something i'm now starting to think about so your insight is a great help. Going back into lurker-mode now 

I came to this thread from a link on the main page, hadn't realised it was an over 50s board. Retirement is the next big milestone despite it being a few years away, so it's lovely to get lots of insight from the experience of others.