Pensions Planning: The NUMBER

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  • Stubod
    Stubod Posts: 2,141
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    1 year in, and our expenditure has been 10% less over the year. We actually budgeted to spend 25% more, we need to catch up with our budget! (The problem is we ended up with some part time work that took out time when we would have been spending it rather than earning!)
    .."It's everybody's fault but mine...."
  • Linton
    Linton Posts: 17,063
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    monthly current income
    less any saving
    less any mortgage and debt (assume debt fully repaid)
    less commuting costs (train, car park, suits, etc)
    add additional leisure costs (more golf balls and shoes)

    I think if you try to work it out on what you spend, then the problem is that larger items such as holidays, building works, cars, insurances get less accurate.


    I dont see planning for these items as a real problem. Assume you replace your car every N years with one you would buy now at a price that increases with inflation. Insurance is what you pay now increasing with inflation. Urgent building works should be covered by your emergency fund. With discretionary large item expenditures such as expensive holidays and house extensions, if you keep a moderately large pot for long term investment etc then you can make a decision at the time.
  • that might be the case, but working on the assumption that you can afford the kind of life you have now is more comforting that working out what kind of life you can have on X assuming i spend particular amounts on particular things.

    There are lots of hidden costs of life that we take for granted in being able to sort - for example a new fridge. Now you might say a new fridge is a once every ten years item. i would agree, but i also have a cooker, dishwasher, washing machine, vaccum, freezer, television, burglar alarm, tumble dryer and computer. If each of those has a life of 10 years, that's one a year.

    Houses typically need 2 or 3% of their capital value spent on them each year to maintain them - that's repairs plus things like painting.

    Rather than guessing what these cost, i simply assume i can afford these now (as i can) and work backwards in deducting things i wont have to spend money on. I am not saying either way is right
  • Flim
    Flim Posts: 47
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    edited 12 September 2018 at 8:51AM
    When I set up our annual retirement budget I assumed an annual expenditure for “general items”. Then every 3rd year I made an additional allowance (20k), for “high cost” items eg car / expensive hols etc. I also “kept” a spare “pot” (60k) to cover any ongoing unforeseen expenditure.

    2 years in and we have “underspent” and “ overearned” (managed to get some unplanned part time work), so currently we have increased rather than reduced our overall pot.
  • Triumph13
    Triumph13 Posts: 1,730
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    Houses typically need 2 or 3% of their capital value spent on them each year to maintain them - that's repairs plus things like painting.
    I think that rather depends on the property / area and whether you are trying to maintain a value reliant on everything being new and fashionable (ie new kitchen and bathroom every few years). The same house might be worth £600k in a popular part of the South or £200k in an unfashionable part of the North. Yes tradesmen will be more expensive down South, but not 3x more expensive.
    Personally I would expect maintenance on my house to be well below 1% pa on average.
  • crv1963
    crv1963 Posts: 1,372
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    Boosting up the Board as I've suggested a couple of people have a look through this thread which was a great help to me when I started looking at our pensions seriously.

    Apologies if that upsets anyone.
    CRV1963- Light bulb moment Sept 15- Planning the great escape- aka retirement!
  • It's a long read but a very worth while one. I've learnt a heck of a lot and can now start planning the escape :-)
  • MallyGirl
    MallyGirl Posts: 6,564
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    Triumph13 wrote: »
    I think that rather depends on the property / area and whether you are trying to maintain a value reliant on everything being new and fashionable (ie new kitchen and bathroom every few years). The same house might be worth £600k in a popular part of the South or £200k in an unfashionable part of the North. Yes tradesmen will be more expensive down South, but not 3x more expensive.
    Personally I would expect maintenance on my house to be well below 1% pa on average.

    Me too - due to the joys of south east house prices 1% is still £10k and we don't spend anything like that annually
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    All views are my own and not the official line of MoneySavingExpert.
  • michaels
    michaels Posts: 27,949
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    MallyGirl wrote: »
    Me too - due to the joys of south east house prices 1% is still £10k and we don't spend anything like that annually

    Aren't we posh....still sounds like plenty of scope for downsizing! We budget about 0.15% of value per annum for general maintenance, this year that will be a new garage door!
    I think....
  • badmemory
    badmemory Posts: 7,626
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    Got to love a new garage door. A few years ago I had a few "issues" with my back which meant an up-and-over garage door was being a minor problem. I now have a roller shutter door. No more avoiding puddles in the gutter (my garage door is inches off the road), no more getting out of the car to close the door. The joys of automation! I had to have roller shutter rather than up&over as I could open it without being able to see if some idiot had parked outside my garage, so an extra couple of hundred to accommodate the idiots of our world. Priceless!


    I got my over 80 year old mother one at the same time although hers was an up& over as it was well back from the road. I think it is about the one thing the buyers of her house haven't replaced (yet).
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