Retirement - Live Life or Penny Pinch

eskbanker

MikeJXE said:

At the minute I am taxed on £100 of my state pension but when I get the increase of about £20 per week the tax man will want  £17...

Are you literally suggesting that you're expecting to pay an additional £17 in income tax from a gross £20 increment, i.e. a marginal tax rate of 85%?  If so, how have you calculated that?

MikeJXE

eskbanker said:

MikeJXE said:

At the minute I am taxed on £100 of my state pension but when I get the increase of about £20 per week the tax man will want  £17...

Are you literally suggesting that you're expecting to pay an additional £17 in income tax from a gross £20 increment, i.e. a marginal tax rate of 85%?  If so, how have you calculated that?

No I'm not saying that at all although by picking bits out of what I said just to criticise you can make it look that way.

I will be getting £20 a week extra which is just over £80 per month less £17 tax and like I said
 maybe £60 rent increase. It was pretty obvious I was talking about a month. 

To some 

ussdave

To be honest I can see how your post could be read that way.  The wording isn't super clear, though re-reading it I can see you intended monthly.

Not a criticism.  Just trying to point out the unclear wording.

eskbanker

MikeJXE said:

eskbanker said:

MikeJXE said:

At the minute I am taxed on £100 of my state pension but when I get the increase of about £20 per week the tax man will want  £17...

Are you literally suggesting that you're expecting to pay an additional £17 in income tax from a gross £20 increment, i.e. a marginal tax rate of 85%?  If so, how have you calculated that?

No I'm not saying that at all although by picking bits out of what I said just to criticise you can make it look that way.

I will be getting £20 a week extra which is just over £80 per month less £17 tax and like I said
 maybe £60 rent increase. It was pretty obvious I was talking about a month. 

To some

I wasn't picking bits out as such, just omitted the rest of the post that didn't seem relevant to your point about tax, but happy to acknowledge that your full post was this, if you feel that makes it any clearer that you were mingling weeks and months (and years) in together:

MikeJXE said:

At the minute I am taxed on £100 of my state pension but when I get the increase of about £20 per week the tax man will want  £17, my landlord will probably put the rent up £60 and then there's council tax to pay so I guess thats it's all gone. When you retire you have to live within your means or not, enjoy doing what you can afford to do or you will be left to your fate with social services. I'm only  82 so could live a lot longer or not, I  only have state pension plus another £1250 per year but I'm ok, sadly some are not. I can also balance one one leg as others can who don't reveal their age so can't judge them 

jimi_man

MikeJXE said:

eskbanker said:

MikeJXE said:

At the minute I am taxed on £100 of my state pension but when I get the increase of about £20 per week the tax man will want  £17...

Are you literally suggesting that you're expecting to pay an additional £17 in income tax from a gross £20 increment, i.e. a marginal tax rate of 85%?  If so, how have you calculated that?

No I'm not saying that at all although by picking bits out of what I said just to criticise you can make it look that way.

I will be getting £20 a week extra which is just over £80 per month less £17 tax and like I said
 maybe £60 rent increase. It was pretty obvious I was talking about a month. 

To some 

Tbh it wasn’t obvious at all. Initially I wondered if you were using hyperbole then I thought you probably weren’t and it just didn’t make sense. 

It does make sense now you’ve explained it. 

IdrisJazz

Back to the original question, I don't think it is possible for me to enjoy living life today if I have too much concern about being able to meet my needs tomorrow.

So it will be the middle ground for me every time. To have peace of mind, I need to know that there will be enough around for however long I live, and for my wife if I were to go first (I probably will).

Fortunately, I have pretty cheap tastes. One of the things I look forward to most, is simply being able to be outside on a nice day, no matter what day of the week it happens to be. Or to take a last minute break in the UK because of a good forecast. I would consider it a luxury to eat out and have a takeaway once a week each. I need to make sure we get in a couple of holidays in those first retirement years, because I am already developing a nervousness about visiting far-away places that is only likely to escalate.

At the moment, my plans lead me to expect joint retirement income averaging £35k per year, dropping to £28k when I pop my clogs (my wife is 6 years younger). We will need to raid the DC pot  fairly heavily initially, until my wife's state pension kicks in.

I hope to be able to leave something in the way of pension pot to my children, in addition to any property.

At the moment, planning to retire at 65, as DC funds have not really performed very well despite putting in 18% a year, but at some point there should be some inheritance from my parents that might allow that to be brought forward. But again, I intend to use a good deal of that to help my kids out as I feel the next generations are going to have things tougher in many respects.

SarahB16

IdrisJazz said:

Back to the original question, I don't think it is possible for me to enjoy living life today if I have too much concern about being able to meet my needs tomorrow.

So it will be the middle ground for me every time. To have peace of mind, I need to know that there will be enough around for however long I live, and for my wife if I were to go first (I probably will).

I am still c. 12 years away from retirement however that is exactly my outlook too.  

IdrisJazz said:

Fortunately, I have pretty cheap tastes. One of the things I look forward to most, is simply being able to be outside on a nice day, no matter what day of the week it happens to be. Or to take a last minute break in the UK because of a good forecast.   

Again, I agree with you on all these points.  I work full time and on those sunny days on a Monday to Friday I do wish I could be outside instead.  A simple pleasure that can be achieved in retirement and last minute UK breaks because the forecast looks good.  

IdrisJazz said:

I need to make sure we get in a couple of holidays in those first retirement years, because I am already developing a nervousness about visiting far-away places that is only likely to escalate.

I hope you don't mind me asking about the nervousness you are developing.  Could you instead simply go on easier foreign holidays.  I've never really been a fan of package holidays but if those are easier for you could you do that instead?  Or maybe still independently travel to Europe if you are feeling more nervous. 

It's a very interesting comment that you make but as I'm 50 not one that I'd ever thought about.  I do expect to holiday more in the UK when I'm older but I still expect to travel abroad.  To me it's all about doing research beforehand and with the internet always to hand on your phone it does make things so much easier to travel.  

I really would be interested to hear what you are nervous about re travelling as you get older if you don't mind sharing this. 

Adyinvestment

IdrisJazz said:

because I am already developing a nervousness about visiting far-away places that is only likely to escalate.

Is this due to health concerns?  My father started to question going abroad in his late 60's after developing some health issues, by 72 he said he had no intention to leave the UK ever again.

Ganga

SarahB16 said:

IdrisJazz said:

Back to the original question, I don't think it is possible for me to enjoy living life today if I have too much concern about being able to meet my needs tomorrow.

So it will be the middle ground for me every time. To have peace of mind, I need to know that there will be enough around for however long I live, and for my wife if I were to go first (I probably will).

I am still c. 12 years away from retirement however that is exactly my outlook too.  

IdrisJazz said:

Fortunately, I have pretty cheap tastes. One of the things I look forward to most, is simply being able to be outside on a nice day, no matter what day of the week it happens to be. Or to take a last minute break in the UK because of a good forecast.   

Again, I agree with you on all these points.  I work full time and on those sunny days on a Monday to Friday I do wish I could be outside instead.  A simple pleasure that can be achieved in retirement and last minute UK breaks because the forecast looks good.  

IdrisJazz said:

I need to make sure we get in a couple of holidays in those first retirement years, because I am already developing a nervousness about visiting far-away places that is only likely to escalate.

I hope you don't mind me asking about the nervousness you are developing.  Could you instead simply go on easier foreign holidays.  I've never really been a fan of package holidays but if those are easier for you could you do that instead?  Or maybe still independently travel to Europe if you are feeling more nervous. 

It's a very interesting comment that you make but as I'm 50 not one that I'd ever thought about.  I do expect to holiday more in the UK when I'm older but I still expect to travel abroad.  To me it's all about doing research beforehand and with the internet always to hand on your phone it does make things so much easier to travel.  

I really would be interested to hear what you are nervous about re travelling as you get older if you don't mind sharing this. 

The problem with travel and age is lack of mobility ,well in our case ,my wife has severe arthritis and whilst we can still travel to somewhere sunny we tend to sit in the sun rather than walk all over sightseeing plus i suspect that a lot of elderly people tend to stick to safe destinations rather than going off the grid and exploring places that younger people would not think twice about going. Also it is easier to book package holidays rather than booking separate elements ,plane tickets etc.

IdrisJazz

SarahB16 said:

IdrisJazz said:

I need to make sure we get in a couple of holidays in those first retirement years, because I am already developing a nervousness about visiting far-away places that is only likely to escalate.

I hope you don't mind me asking about the nervousness you are developing.  Could you instead simply go on easier foreign holidays.  I've never really been a fan of package holidays but if those are easier for you could you do that instead?  Or maybe still independently travel to Europe if you are feeling more nervous. 

It's a very interesting comment that you make but as I'm 50 not one that I'd ever thought about.  I do expect to holiday more in the UK when I'm older but I still expect to travel abroad.  To me it's all about doing research beforehand and with the internet always to hand on your phone it does make things so much easier to travel.  

I really would be interested to hear what you are nervous about re travelling as you get older if you don't mind sharing this. 

No problem at all.

I'm a pretty unadventurous person anyway, and prefer to stick to things I know. Fortunately, my wife is more adventurous, so we have left the country three times in twenty years together! (USA twice and Paris)

I'm particularly conscious of personal safety while we have children. I'm nervous of being mugged, encountering "overenthusiastic" panhandlers etc wherever tourists tend to stand out, being ripped off because you don't know the local taxi prices etc. I'm nervous of going somewhere with vastly different culture (e.g. far east) due to perceived inability to communicate. Over the last few years, the added uncertainties of travelling during covid added a new angle, with the risk of flights being cancelled etc. meaning I might worry before going, rather than looking forward to it.

In retirement, when there might only be two of us, I might feel more relaxed in some of these matters, as long as we have our wits about us. I would genuinely like to go inter-railing round Europe, and a cruise seems fairly low risk. I find it difficult to imagine myself going anywhere in Africa, Asia or South America though.

Travel insurance can be harder to get as you get older, and have existing conditions to think about, so that's why getting the travelling done early in retirement (maybe while my wife is still working) would be a priority. And of course you become more physically vulnerable...