How much to live on

Albermarle

Tastiger said:

I see the PLSA have updated their retirement figures. £43k now for a couple in moderate retirement. Pretty sure the were quoting £34k last year. That's a rise of 26%. Makes my blood boil. We won't be on anything like this and I still think we will have a comfortable retirement.
https://www.retirementlivingstandards.org.uk/

It has been increased twice in the last 12 months I think due to inflation.
Also many people just think about their day to day expenditure and things like holidays, new white goods, house upgrade, new car, gifts to family etc are paid from separate savings.
These PLSA figures include amounts for these things as part of yearly expenditure, so that pushes the figures up.
Anyway it has all been discussed many times before, including the previous three or four pages of this thread and here.
Cloud Cuckoo Land — MoneySavingExpert Forum

Not sure though it is worth getting your blood pressure up over a survey.

Organgrinder

Albermarle said:

Tastiger said:

I see the PLSA have updated their retirement figures. £43k now for a couple in moderate retirement. Pretty sure the were quoting £34k last year. That's a rise of 26%. Makes my blood boil. We won't be on anything like this and I still think we will have a comfortable retirement.
https://www.retirementlivingstandards.org.uk/

It has been increased twice in the last 12 months I think due to inflation.
Also many people just think about their day to day expenditure and things like holidays, new white goods, house upgrade, new car, gifts to family etc are paid from separate savings.
These PLSA figures include amounts for these things as part of yearly expenditure, so that pushes the figures up.
Anyway it has all been discussed many times before, including the previous three or four pages of this thread and here.
Cloud Cuckoo Land — MoneySavingExpert Forum

Not sure though it is worth getting your blood pressure up over a survey.

Shock horror. Organisation promotes something they have a vested interest in.

Perhaps though the most shocking thing is that IF the figures they quote are correct, then just how much of the population cannot attain these figures even in full time employment!

These are after tax figures too. And in my opinion, quite frankly nonsense.

BooJewels

I tried to work out just what I'd spent in the last year - and whilst I keep a lot of money data as I go along, that figure was harder to ascertain than I expected.  But I worked it out 2 ways and came to almost exactly the same figure of £18,300.  My basic living of DDs, food and routine shopping averages about £900 per month - so about £12k of that figure is routine, unavoidable stuff - when you add in annual expenses like insurance renewals.  My average monthly spend on supermarket style debit card spending was £237.62 over the last 14 months since I started noting it.

I live on my own and am mortgage free, but don't yet drive.  I had 2 UK cottage holidays, had my roof repaired, 14 driving lessons, a dental crown, new glasses, 2 x new TVs, an extra aerial lead, some furniture and new blinds for 2 windows.  I paid someone to do some jobs in the garden and then replaced many of my aged plastic pots with nicer ceramic ones and new plants.  Plus, a number of extra items - I do list anything 'above and beyond' each month as I go along - like repairs I pay for, hobby materials, extra taxi fees - like the last 2 months going to the fracture clinic 20 miles away.

I think I can more than double that figure this year as I want to go back to the driving and get a car and an expensive holiday we've had to postpone several times is set for 2024.  Plus a couple of house projects didn't get done last year after tradesmen let me down, so I do intend getting them done this spring - if I can find someone that will actually turn up.

Archerychick

Tastiger said:

I see the PLSA have updated their retirement figures. £43k now for a couple in moderate retirement. Pretty sure the were quoting £34k last year. That's a rise of 26%. Makes my blood boil. We won't be on anything like this and I still think we will have a comfortable retirement.
https://www.retirementlivingstandards.org.uk/

There is quite a lot of threads on this. It assumes that you’ll be financially helping out grand children and the whole report is based on a mere 135 people, so take it with a pinch of salt.

its more important to work out your lifestyle needs. Mine will definitely not be anywhere near the figure in that report 

MarzipanCrumble

Albermarle said:

MarzipanCrumble said:

Savvy_Sue said:

MarzipanCrumble said:

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

Is it not obvious? I have a sibling with their own generous private pension, plus generous inherited pension from spouse, plus state pension. They're not quite in the higher tax bracket, but could take on some self-employed tutoring which might push them into it. So they've held back from the tutoring ... 

(They know they'd still be better off (marginally) even paying a small amount of higher rate tax, but they don't want the hassle.)

Yup - that is me.  DB pension, worked beyond state pension age to add 10% for 5 years to SP, widow pensions.  Don't need to supplement by work.

However I worked beyond retiring when SP said I should so that I could have that peace of mind and the income to meet unexpected expenditure without stress.  It was an informed choice for me, just like those that for various reasons want to retire early, do their financial calculations to make that happen.

worked beyond state pension age to add 10% for 5 years to SP, 
As you may know this generous uplift for deferring the SP has been reduced to about 5.5%, so less attractive than it used to be.

However I worked beyond retiring when SP said I should

The date you start with the SP bears no relation to when you should retire. There is no official retirement date in the UK.

Why so aggressive #Albermarle?  'Should' is not 'must' - so, obvious I did not need to retire.  'Must' in NHS is 75 - then you have to retire.

Yes I realise that now the Gov is not so generous with the new SP deferred interest rate.  Hoiwever when it was introduced in April 2016 even 5% was generous against what you could get in the bog standard cash saving deposit account.

Albermarle

Why so aggressive #Albermarle?  'Should' is not 'must' - so, obvious I did not need to retire.  'Must' in NHS is 75 - then you have to retire.

Probably spent too much time on the pensions forum, where you often see posts where people get confused regarding retirement date/state pension age/when they can take a personal/workplace pension. There is still a belief amongst many people that there is some kind of UK retirement date, so was just making sure that was understood.

Yes I realise that now the Gov is not so generous with the new SP deferred interest rate.  Hoiwever when it was introduced in April 2016 even 5% was generous against what you could get in the bog standard cash saving deposit account.

Although around the time, investment returns were generally much better than 5% pa, which regarding a long term item like pensions is probably a better marker. The general consensus is that it is not really worth deferring anymore, unless you are still working when you get the SP.

louby40

The figures they quote for retirement are ridiculous. Some people don't even earn that much never mind expect to get it in retirement. 

I'm hoping for a £20k p.a retirement at 60 with no mortgage and a modest lump in the bank of about £50k. Once my state pension kicks in I'll be a bit better off.

Organgrinder

louby40 said:

The figures they quote for retirement are ridiculous. Some people don't even earn that much never mind expect to get it in retirement. 

I'm hoping for a £20k p.a retirement at 60 with no mortgage and a modest lump in the bank of about £50k. Once my state pension kicks in I'll be a bit better off.

Totally agree with you. We're looking at about £28k at 61 with about £120k in the bank to see us through to 67. A combined pension at 67 of approx £51k means about £45k after tax which is in my opinion more than adequate.

MarzipanCrumble

Accepted #Albermarle - all good - I do look at the Pensions Board but mainly it is about building up a pension rather than the problem any high tax income and / or IHT will impact once retired.

As a couple we did not even think about pensions until my early 50's, OH late 50's.  Yes, I / employer contributed to DB pensions; OH had a combo of Teacher pension (early 20's) and DC pension which he converted to an annuity on advice of IFA.  We were upper middle income I suppose - no bonuses - I worked NHS which I joined in my 40's; OH had worked as teacher, then in a sports organisation with a DC pension, but was an exec admin, then back to teaching.

IMO I think possibly that most don't actively think about pensions until they of an age that retirement is imminent.  BUT it is never, ever too late to do something about enhancing your pension income.  The earlier the better - of course.  But even in your 50's  you can do something about it.  

I am in the IHT bracket, but this is because of property.  Bought first house in Blackpool early 70's for about 4k
- moved to London and got a 3 bed semi 2 mins from Dulwich village for 10k mid 70's then moved to South Wales mid 80's bought a detached for 125K in a really desirable location which is now worth around 850K.  (The Dulwich house is now worth £1.4 million, just looked it up.)

So due to property inflation and the fact I am a saver IHT looms for my inheritors.  I didn't mean for this to happen, it is circumstantial and I have to plan for the consequences. 

Edit:  Due to lump sums from pensions and Inheritance from my parents who, although British, migrated to Australia after retirement, where there are no death taxes, I have additional funds in a shares ISA, Bonds and also a SIPP that I have not broached - and yes, I know a SIPP is out of the estate.

And i would rather be in this position than scrimping and saving, but I feel guilt because it has fallen into my lap without me or my OH doing anything to bring it about other than life circumtance.


 

Archerychick

louby40 said:

The figures they quote for retirement are ridiculous. Some people don't even earn that much never mind expect to get it in retirement. 

I'm hoping for a £20k p.a retirement at 60 with no mortgage and a modest lump in the bank of about £50k. Once my state pension kicks in I'll be a bit better off.

Agree! I live on £18k a year now (which is without the mortgage).

The report in my mind is not fit for purpose being based on 135 people - I think it would be very different with a 3k sample size. It does also factor in giving money to grand children, which of course is going to be personal to your own situation- I don’t have any children so that’s not to be factored into my future. I think the key message is you have to know what your lifestyle costs now, then think about what you want your lifestyle to look like during retirement and then model income requirements from that