Can you manage on just a state pension ?

Since retiring because of covid, heating and food bills have just shot up. However, I pay a lower premium for car insurance as the mileage is lower but it doesn’t cover the cost of the electricity hike.

My husband had to retire at 57 because of increasing deafness. I had never worked and was unable to find a job. So we sold the house and bought a smaller one in a cheaper part of the country. Invested the money. Interest rates were higher then. He paid voluntary contributions so would get full state pension at 65.
We enjoyed the outdoor life camping and caravanning and a simple life. for ten years until my husband sadly died.
I am now 98 and manage very well on the state pension plus pension credit guarantee( because I have a little savings) and lower Attendance Allowance. I am able to employ daily help for the tasks I cannot manage.
I am not ashamed of living off the state because we both spent the wartime years fighting and getting wounded for our country.

You have to take into consideration any repairs and maintenance you may need to your house. it is recommended that you paint outside every three years and inside every five years, you would be sensible to get your electrics fully checked over before you retire so there are no unexpected expenditures. Depending how rural you are would it be cheaper to give up the car taking tax, insurance and running costs into account ands a community bus if you have one or a taxi once a week. worth working out before you commit to anything.

Surely it boils down to this for everyone....... do you really want to ‘live’ a very frugal life watching every penny, unable to be spontaneous with your money as it is all accounted for in advance?

It doesn’t sound a very attractive proposition does it?

We all know the old saying that money doesn’t buy happiness and up to a point it’s true, but to condemn ourselves to an impoverished old age is a pretty miserable proposition isn’t it?

We have just paid £150 road tax for our small car and from next year there will be MOT as well as service, tyres etc. and insurance increases every year for car and house also our water rates have just gone up again and we expect council tax to do the same, do figure in all these sort of expenses when you work out your budgeting. It also costs more for gas and electric than previously, £90 combined each month and there are only 2 of us. Good Luck

From experience I can tell you that state pension doesn't go far but I manage on a single state pension (and you would have two) and run a car. I don't spend money on clothes or regular holidays and I don't waste 'stuff'. It was a huge shock to me after earning a really good salary to come down to pension (my private pension company folded) but I manage. I have to.

We each put £400 into a joint account monthly and that pays all the bills (utilities, council tax, insurance etc) and buys the food and everyday household stuff. It builds up enough to cover annual bills like boiler maintenance.

All the essentials in fact.

What’s left of our pensions is our own to spend on clothes, hair, going out. The frills.

It doesn’t feel like a frugal life at all. We have everything we want. I suppose it depends on what you’re used to.

Thank you Casdon and 3dognight . I already cook from scratch , batch cook and freeze all left overs and have only had a couple of takeaways since the start of lock down . We planned to set aside around £20k as an emergency fund , so this isnt included in the amount we will use to live on till our state pensions kick in. Our current thinking is that our mental health and time is more important than money and that many live on a lot less than £1400 per month after housing costs , but I get the feeling that many on here feel it's an existence rather than living and that's why I was interested in hearing of the experiences of those who are retired , as a couple, on a state pension .

My mother has the basic pension plus housing benefit and attendance allowance. She manages because we are always buying her treats - wine, chocolates - and clothes. We also pay for other things like opticians. Basically, she couldn’t manage on the state pension alone.

We did this.Initially DH stopped working at 59 and we lived on my salary which was about the same as 2 state pensions. After 3 years and managing fine I took early retirement with reduced pension and hubby took his private pension as a drawdown monthly amount equal to state pension. We both took the tax free lump sum and bought a small property to rent out which gives us an income used for holidays and any large bills. I found having more time reduced outgoings as I can shop around for better deals for utilities insurance using cashback sites helps. Spent the first year doing a massive de clutter of STUFF which netted over £5000 by selling on eBay and local selling sites. I do odd bits of work such as mystery shopping and local elections but it's my choice how much I do. In my case I've never been happier

Message withdrawn at poster's request.

Thanks Goggins , we both already have 40 years plus of full NI contributions so will be entitled to full state pension .

The road tax for my small car Peugeot 107 is £20 per year because of its energy efficiency.
Your petrol, or other costs of commuting, may be less when not working.
I keep heating of the house to a minimum and make good use of cosy jackets and blankets plus hot water bottles.
I'm not in a couple on state pension so can't speak specifically about that, tho.

It sounds like a good idea to try living on the amount you would have as pension, while continuing to work, to give you a better idea of how it would be.

Thanks to everyone who has replied . We have allowed for 4% inflation in our calculations for price increases . We have also allowed for an extra 2 years without state pension in case the rules/ age changes again . I have looked at our current outgoings, both essential and non essential and we are spending under £1400 per month on average as we have been saving all the rest for retirement . Everyone has their own comfort level but @ JenniferEccles , I certainly don't feel impoverished at the moment on this level of income, although I appreciate that it being a choice rather than a necessity may make a difference.

Something to consider is car purchase. There are 9 new car taxes coming, and one of them is going to be a purchase tax which will penalise you if you buy a car that is not considered energy efficient.

I've managed on the basic state pension for 12 years now. I run a home [no mortgage] and have a car to keep on the road, I have all bills and 75% council tax to pay on my own.

It's doable but I have a simple life out of choice, few holidays which are spent in the UK in holiday cottage split costs with a friend. I eat well, cooking from scratch every day, my hobbies are reading, gardening, walking, writing, renovating furniture, DIY. I [pre-covid] eat out now and then, and have many days out. I'm content with my life and family and don't feel I'm missing out or deprived at all.

However I have a lump sum of savings from an inheritance tucked away which means I do not qualify for pension credit. But I have never had to dip into those savings for everyday living costs, my pension takes care of it all. It means though that I wouldn't have any problem if I needed expensive house repairs or replace the car for example.

So I feel secure and have no money worries. Without this maybe I wouldn't feel so comfortable. If someone has a property there is always the option of releasing some equity if it means making life bearable...but only a reasonable amount and later years.

I'm 64 and wondering whether to leave my depressing job this year when I'm 65 or stick it out another year. I may have to wait in any event as it might not be a good idea to take my private pension now as there remains some element of equities in the investments. It would probably be better to hang on until the stock market has gone up a bit with post Covid recovery. I'm hoping for great things from the Stock Market over the summer as I'd really prefer not to be working in this job after Christmas.

I see FarNorth has suggest equity release. Please be wary of this, and seek independent advice before doing so, these companies aren't covered by the appropriate governing bodies, to ensure the relevant terms and conditions are carried out according to UK law. Yes, they have letters behind the name, and while there are reputable companies our there, there are many, who find cleverly worded loop holes to make sure you end up owing a lot more than you were originally led to believe. Please exercise great caution, that's all I'm saying, I know so many people who have been duped by these companies. I guess its ok if you have no relatives to pick up any debts incurred, or your not worried about any inheritance that may NOT be left. I.m just trying to warn you, there maybe consequences related to equity release. But ultimately the choice is yours.

I would double check the position re state pension. My sister is looking at early retirement due to redundancy. As part of the financial advice she has received during this process, she has been advised she will need to continue paying voluntary NI contributions until retirement age in order to receive full state pension. She too has 40 years contributions.

I think I’d try and carry on working until your state pension kicks in. The reality is you could live another 20 years. Use your last working years to build up your savings. I’ve dropped down to working 3 days a week, to get used to less money. Is this something you could both do ???

Our aim was always to sell our house. Downsize and use the extra money for holidays and such. But we’ve still got 2 AC at home and a grandchild. So that plan didn’t work.

Its hard at first to manage on just a state pension. But you can get by. Its amazing how little I spend now and take time to enjoy what I have rather than what I wish had. I would make the most of the time when you have two pensions and get the things done to your house that need doing while you can afford it, something I wish I had done before my DH died.

@Sandytoes You say mental health is more important than money, but don't forget being broke when an unexpected expense comes along or inflation makes a huge dent in your income will have an impact in mental health too.
I would worry about that and couldn't contemplate a life without holidays and the ability to buy what I fancy after a life of hard work. But, it 100% depends on your personal outlook, what really makes you happy and what you want your standard of living to be - just make sure you can cover the essentials and have money for emergencies.
Once you've given up work, it would be difficult, but not impossible, to boost your income again.
During lockdown, DH and I can live on about £1000-£1200 a month (no mortgage), but that's without annual bills, travelling or eating out and frankly, is miserable. I would hate to live like that every month.
Personally if I were you I'd carry on a while longer but, as I said upthread, perhaps change the type of work/reduce to part time.

Have you checked to see if you would get the full state pension if you retire early as the purpose of the government making it later before you can claim but also because people in work are still paying into the pot as it were. The other thought would be to take redundancy or part time option from your present jobs as when this lockdown period is over many employers will be looking to reduce outgoings so don,t give in your notice before exploring all options .

Sandytoes I would double check your state pension forecast as I am 61 and need 46 years contributions under new pension rules for full state pension which will then be reduced as I paid into a company pension. The government pension helpline are very good.

You seem to be concerned about your health, both physical and mental. Do please take that into consideration when making your decision. Healthy food and keeping warm are crucial as are hobbies, activities and outings. These things will safeguard your health as you get older.