Retirement Living Standards

mrklaw

9% achieve comfortable from the very people that wrote the report? Thats honestly bordering on irresponsible. Why put a goal in people’s minds that is unachievable by the vast majority?

as for us, we’re bumbling idiots that accidentally stumbled into an ok situation at the last minute - 5 years of 40% contributions plus a lucky private DB scheme means we’ll be ok. and our ‘comfortable’ is 40k a year including a dedicated 12k a year holiday fund. I wish I’d foudn this place and other retirement planning areas 10 years ago and we’d have been retired by now I think (and I’d have had one fewer stupid car purchase)

QrizB

Abject poverty v relative property - It would be really i interesting to explore this fully and critically without falling into mud slinging and whataboutery.

Weekly income thresholds from Trust for London (I've removed the London-specific columns):

Definitions:

The UK poverty line - Households are considered to be below the UK poverty line if their income is below 60% of the median household income after housing costs for that year.

Destitution - Households in destitution are defined by the Joseph Rowntree Foundation as those who have to go without two or more essentials in the past month because they couldn't afford them, or if their income is extremely low (less than £95 a week for a single adult). Essentials are defined as having a home, food, heating, lighting clothing, shoes and basic toiletries.

QrizB

That's brilliant and great to hear but how then to balance pensions between spouses?

We haven't, is the short answer. We've paid as much as we can into my wife's DC pot but it's only 1/6th the size of mine. She's also got a small DB from early in her career but that's not worth a lot, maybe £2k pa at NPA.

Silvertabby

https://forums.moneysavingexpert.com/discussion/comment/82023435#Comment_82023435

Abject in today's terms, but normal for back then, I suppose. Outside loo, no heating bar a coal fire in the lounge (when it was lit), no hot water on tap. But mum thought that we were 'posh' because we had an indoor bathroom with a bath and handbasin - even though weekly bath night meant carrying the hot water upstairs by means of a procession of kettles and saucepans.

Most of our clothes came from jumble sales, and tea on a Thursday night before dad's pay day (and sometimes Wednesday) would be jam butties. But there must have been people poorer than us, because my sister and I didn't qualify for free school meals ..... cue more jam butties, as paying for school dinners wasn't an option.

Summer holiday would be a day charabanc trip to the seaside or the lakes. The return trip usually involved a stop in a cafe for tea, but not for us - we would sit outside with paste butties and a flask of tea, while I promised myself that one day I would have a cream tea in a cafe......

Many years later, we have 80 years of public service between us, including over 50 years in the Armed Forces, and so feel not one iota of guilt re our public sector DB pensions.

Sadly, our parents are no longer with us - but I can still see my mum's face when she saw the house we were buying - 4 beds, 2 bathrooms, 3 (indoor) loos, central heating and hot water on tap!

poseidon1

As part of the debate about having 'sufficient' income in retirement, I consider it very short sighted by those who strive( at all costs) to be permanent basic rate tax payers in retirement.

A relative had this mindset when trying to decide his mix between tax free cash and annual pension 10 years ago from his DB scheme. Originally he intended to elect for £32k per year and max TFC of just over £200k.

However, convinced him to give up £100k cash to top up annual pension to £45k ( just above the 40% tax threshold at that time ).

Admittedly his was an extremely generous company pension scheme which very few of his peer group qualified for. However, 10 years on he has now hit £77k per annum after inflationary increases, with 2/3rds payable to spouse if he predeceases her.

Looking back, he fully appreciates this high level of financial security and freedom his decision has created, notwithstanding that coupled with his full state pension he now gets pension income which in the not too distance future will noticeably exceed his pre- retirement earnings.

In the circumstances he is not overly concerned about eventual loss of personal allowances once he hits £100k + pensions, given the assurance of a more than comfortable lifestyle.

BikingBud

@Silvertabby I feel we are vey much in the same think space but I am trying very hard not to descend into a Monty Python sketch. We have taken opportunities to better ourselves and are much better set for those decisions.

@QrizB

The UK poverty line - Households are considered to be below the UK poverty line if their income is below 60% of the median household income after housing costs for that year.

Destitution - Households in destitution are defined by the Joseph Rowntree Foundation as those who have to go without two or more essentials in the past month because they couldn't afford them, or if their income is extremely low (less than £95 a week for a single adult). Essentials are defined as having a home, food, heating, lighting clothing, shoes and basic toiletries.

So the poverty line is actually low wages - and it seems that many will continue to be living on low income in retirement.

How many are living in destitution?

QrizB

How many are living in destitution?

3.8 million in 2022, per the Joseph Rowntree Foundation. Around 1 million of those were children. Although that's "at some point" so it's likely that fewer spent the whole year destitute.

Three-quarters of those were in receipt of social security benefits at the time.

Nebulous2

https://forums.moneysavingexpert.com/discussion/comment/82023577#Comment_82023577

There will always be arguments about cause, and choices made with available money, but however you cut it, and whatever your political views - small children have no agency in that and no control over what happens to them.

Friends and acquaintances who are teachers tell some harrowing tales about children whose only reliable source of food is the school, and who at times have nothing to eat from Friday to Monday.

I've struggled with the idea that in the midst of what was described as a cost-of-living crisis I've found it difficult to get a table in a restaurant, or we go to an expensive tourist attraction and it is full of families spending freely on food, entry fees, additional rides etc, spending several hundred pounds in a day, and matching that with the poverty which rarely passes my vision - but I have enough people I trust who are weary of dealing with it - to believe it is true.

NormalNorman

https://forums.moneysavingexpert.com/discussion/comment/82023599#Comment_82023599

I remember a long time ago, often daughter's friends would come home with us after school for a play date. One kid, she is still friends with her now, always enjoyed a meal with us. Turned out her parents were rarely feeding her. Despite a dreadful upbringing she has managed to turn her life around. Obviously she came from pretty poor housing whereas ours was a chocolate box cottage with an acre of landscaped gardens, river at the end of the property with an ancient stone bridge crossing it etc. Most of the community was like this so perhaps the environment and kindness of her friends inspired something within? Nothing more important than kids at the end of the day.

Asimovs_nightfall

https://forums.moneysavingexpert.com/discussion/comment/82023049#Comment_82023049

Yes, but from Waitrose, Tesco or Greggs?