Retirement Living Standards in the UK: 2024 update published

michaels

Phossy said:

They have interviewed a few more people this year "In total, 249 people participated in the discussion groups, across thirteen different locations in the UK (including groups in Northern Ireland, Scotland and Wales)", but it feels a woefully small number to get a real feel. Add to that a high proportion are not retired and under 50. I don't think this is a fair representation, but it is nicely packaged and media outlets and YouTubers will run with it without question, but likely a few defense mechanisms.

Anyone know what this year's random above inflation lifestyle upgrade they have applied is?

westv

The Which? survey that seems to do the sane thing interviews several thousand people - or am I mistaken?

ali_bear

Remember that once you are retired you can no longer raid the office stationary cupboard!

daveyjp

ali_bear said:

Remember that once you are retired you can no longer raid the office stationary cupboard!

Is the stationary cupboard the one that contains stationery?

kimwp

https://www.which.co.uk/news/article/the-price-of-a-comfortable-retirement-20000-a-year-which-research-reveals-aNKPz6x07swU

I couldn't find a Which survey more recent than this. 

michaels

Organgrinder said:

When compared to the IFS figures for household incomes, the PLSA figures place the categories for singles/couples a follows:

Comfortable: Better than 91%/85% of the population
Moderate: Better than 78%/66% of the population
Minimum: Better than 17%/17% of the population

Of course this is after housing costs - so will differ even more for those with housing costs. But we should remember that the figures themselves are based on a survey of a small number of people. Myself and my wife do not come anywhere near the comfortable figure but our figures would I think provide for a nice retirement.

So I delved further into their examples.

Nicole who they decribe as a higher earner contributing 8% of her salary - she would have a slightly below moderate retirement.
Daniel and Aisha (one higher earner, one median) - a similar story moderate
Josh and David (both higher earners) - again moderate but slightly higher
etc.

They suggest increasing the pension contributions. Hardly surprising given who the PLSA represent - yes, the pensions industry.

This is the bit I find hard to fathom - surely the standard of living should compare to the average standard of living in the UK - afaik median household income is about 34k so 'moderate' which sounds to me like some sort of measure of average surely should reflect what life in the UK is actually like rather than being something highly aspirational for most?

Perhaps income distribution is skewed towards those who are older so may be moderate rather than relating to the general population should be linked to the median household income of those close to retirement age?  Is there any data for this?

Roger175

SouthCoastBoy said:

Our annual expenditure is around 30k a year(after tax) give or take a couple of thousand. On this we run two cars,have holidays abroad (at least once a year) and some uk weekend breaks, plus support  2 adult kids with the odd few hundred pounds now and then. 

The 30k puts us in the moderate category, but I would say I am living comfortably on 30k after tax, which should get easier when we are retired as currently we have to take holidays during school holidays as my wife is a TA.

Totally agree, our expenditure is around £35k which buys us a comfortable living. We've accurately recorded exact expenditure for the last 3 years as we geared up for retirement, so this is not an estimate. We have a large detached countryside property, run 3 cars, take several foreign holidays a year and help 3 adult children from time to time.

I've always found the PLSA figures bizarre. They suggest our comfortable cost of living in retirement will be more than we've ever actually earnt and that was when we were building up pensions, bring up 3 kids and paying a mortgage etc. 

Organgrinder

michaels said:

Organgrinder said:

When compared to the IFS figures for household incomes, the PLSA figures place the categories for singles/couples a follows:

Comfortable: Better than 91%/85% of the population
Moderate: Better than 78%/66% of the population
Minimum: Better than 17%/17% of the population

Of course this is after housing costs - so will differ even more for those with housing costs. But we should remember that the figures themselves are based on a survey of a small number of people. Myself and my wife do not come anywhere near the comfortable figure but our figures would I think provide for a nice retirement.

So I delved further into their examples.

Nicole who they decribe as a higher earner contributing 8% of her salary - she would have a slightly below moderate retirement.
Daniel and Aisha (one higher earner, one median) - a similar story moderate
Josh and David (both higher earners) - again moderate but slightly higher
etc.

They suggest increasing the pension contributions. Hardly surprising given who the PLSA represent - yes, the pensions industry.

This is the bit I find hard to fathom - surely the standard of living should compare to the average standard of living in the UK - afaik median household income is about 34k so 'moderate' which sounds to me like some sort of measure of average surely should reflect what life in the UK is actually like rather than being something highly aspirational for most?

Perhaps income distribution is skewed towards those who are older so may be moderate rather than relating to the general population should be linked to the median household income of those close to retirement age?  Is there any data for this?

Roger175 said:

SouthCoastBoy said:

Our annual expenditure is around 30k a year(after tax) give or take a couple of thousand. On this we run two cars,have holidays abroad (at least once a year) and some uk weekend breaks, plus support  2 adult kids with the odd few hundred pounds now and then. 

The 30k puts us in the moderate category, but I would say I am living comfortably on 30k after tax, which should get easier when we are retired as currently we have to take holidays during school holidays as my wife is a TA.

Totally agree, our expenditure is around £35k which buys us a comfortable living. We've accurately recorded exact expenditure for the last 3 years as we geared up for retirement, so this is not an estimate. We have a large detached countryside property, run 3 cars, take several foreign holidays a year and help 3 adult children from time to time.

I've always found the PLSA figures bizarre. They suggest our comfortable cost of living in retirement will be more than we've ever actually earnt and that was when we were building up pensions, bring up 3 kids and paying a mortgage etc. 

I too find the figures the PLSA uses bizarre.  

We estimate being able to holiday abroad 3 or 4 times a year. Be able to replace our cars every 4 years, eat out regularly etc and still find our savings growing! Ok things may change over the next few years but even so I find the figures they quote somewhat unrealistic.

As you can guess I am somewhat cynical with regard their motives. So maybe what we should be asking is "in comparison to the PLSA figures what do those on similar incomes spend their money on?" or "what do you need to have a lifestyle similar to those quoted?"

westv

kimwp said:

https://www.which.co.uk/news/article/the-price-of-a-comfortable-retirement-20000-a-year-which-research-reveals-aNKPz6x07swU

I couldn't find a Which survey more recent than this. 

That must be the one I'm thinking of. 2023 so not that out of date really.

kimwp

westv said:

kimwp said:

https://www.which.co.uk/news/article/the-price-of-a-comfortable-retirement-20000-a-year-which-research-reveals-aNKPz6x07swU

I couldn't find a Which survey more recent than this. 

That must be the one I'm thinking of. 2023 so not that out of date really.

The article implies that they do the survey every year, but I couldn't find one for 2024. It's surveying which users, so representative of the more money conscious part of the populations.