How much do you need to live on in retirement?

I’m shocked at the amount some are getting. Some are living on much much less. We can live ok on a much lower retirement income. You save for retirement if you can. Most can’t.
I smile at the lady who mentioned holidays, hair, nails. We do need to cut back in retirement, and that’s a fact of life. If you have lived on minimum pay all your life, how can you save for retirement. Some have coffees out and lunches out and cruises in retirement. Most can’t afford this even when working. How the other half live!!

SueEH

I’m amazed at what some people feel is necessary to live on.
Last month I ditched the part time job that I hated - in which I was being taken advantage of for no extra remuneration- and am now working solely at my other 16 hour part time job.
As of next April my annual income will be around £8600. I have a very small private pension - approx £150 pm - that I can take and that plus savings will be that until I get my state pension.
I do have savings and for the next few years I aim to live on what I earn and give myself permission to use the savings for unexpected occurrences and holidays.

It’s not a virtue to survive on very little, but for many it’s a necessity, for others a choice. For many of us though, retirement includes doing the things we enjoy for as long as we can without financial worry, many of which which cost money. We could probably survive on a state pension if we had no option, but I can only speak for myself, I’d find that a miserable existence because I would not have enough to pay for my peace of mind regarding bills, and do the things I want to do, and I’m glad I worked full time into my sixties so I am now able to. I don’t understand why you are amazed that people have made different choices to your own, they aren’t wrong, just different.

You seem to have a good amount to live on! Depends on what your habits are? Several foreign hols/year? Doling out Dosh to kids etc? Running 2cars ?
We retired in 2007 after 30 years service and just now get state pension. Just finished mortgage and don't owe anything else. But And it's quite a "but" we now have one hybrid car, having sold 2 superpower cars! very few if any holidays, we don't need those "down times" as before as stress free now no work!! Spending calms down after initial shock of being able to do/go where we want when we want no strings!! You sound well positioned really , just relax and drink in the freedom from bonkers hours/restricted hols/pressure to dress the part/Sunday night blues...😅 you'll find your level pretty soon, have a ball!!

LovelyLady

I’m shocked at the amount some are getting. Some are living on much much less. We can live ok on a much lower retirement income. You save for retirement if you can. Most can’t.
I smile at the lady who mentioned holidays, hair, nails. We do need to cut back in retirement, and that’s a fact of life. If you have lived on minimum pay all your life, how can you save for retirement. Some have coffees out and lunches out and cruises in retirement. Most can’t afford this even when working. How the other half live!!

Absolutely! I've found that I have tons down the beauty costs (I finally actually feel and look-beautiful!!!) Lockdown broke my wasted £0/months gel nails habit, who was I Impressing- the wheelie bin guy?! And decades of being 'booted and suited' has given me knowledge of feeling/looking good priceless when make-up's becoming less important . My one indulgence is my choir!!! It's really my treat and has helped me keep up socialising skills as I don't see a soul from month to month now, I dress well and do face and hair so I feel good! Daft coffee shop stuff? Designer handbags? Why? Happiness is priceless and can't be bought-so save yer Dosh!! Personally I've always thought that "the other half" are suckers! Falling for all the clichés of what we "need" spoonfed to them by an anonymous corporations who dont care a jot for them ,just their profits!

#£30/month on.....nails!!!!!

biglouis

I am not of a mind set where I could just kick back, watch TV and stay n bed. I would get bored pretty quickly.

I never really "retired" in the full sense of the word. I drew my state and private pensions and ceased employment at 60. However I continued to do research and consultancy for the uni for at least 8-10 years. Alongside this I expanded my side hustle of selling antiques. However I do take 3 months a year off (April, August and December/January).

I could easily take up online tutoring again if people stopped buying antiques.

My advice to anyone coming up to retirement is to find a nice little side hustle that you enjoy doing and that will bring you in extra income.

Oh dear , I hope you don't only have watching TV and lying in as options in retirement?! You can do almost anything at all! Just "switching off" is the fast track to going down a very short old road to nowhere

Really concerned about so many young people I hear of, who aged 40ish, have made NO provision whatsoever for a pension. It is a disaster waiting to happen.

I agree Fleurpepper. I know there are many financial pressures but we had them too.
I recently tried to encourage a relative to start paying into a pension and said how glad I was that I'd started in my 20s (thanks to pressure from Dad). Her reply was, 'What if I don't live that long?' I should say that she's perfectly fit and well. I wish I'd said, 'Well what if you do?' However, being British, talking about money is just not done. So I didn't. Unfortunately.

When is enough money ever enough? The good bit is the budgeting. I expect you will have a lump sum too. We worked out the cost of actually going to work. Fees. Transport etc so with that being saved and adding our anticipated pension we decided the difference in salary was small enough to give it a go. With the option to seek employment if we were struggling but health changes plans. So I would say do it, Safe in the knowledge that you will get a further boost to your income once you reach State Pensionable age. Life is too short.

“It’s not a virtue to survive on very little, but for many it’s a necessity, for others a choice. For many of us though, retirement includes doing the things we enjoy for as long as we can without financial worry, many of which which cost money. We could probably survive on a state pension if we had no option, but I can only speak for myself, I’d find that a miserable existence because I would not have enough to pay for my peace of mind regarding bills, and do the things I want to do, and I’m glad I worked full time into my sixties so I am now able to. I don’t understand why you are amazed that people have made different choices to your own, they aren’t wrong, just different.”

I don’t think I said I was amazed that people have made different choices to mine? I respect anyone’s right to make the decision which they feel is best for them. I made the choice that was best for me as my mental and physical health was suffering and I was not prepared to accept that any longer.
What I did say was that I was amazed at the amount of money that some people quoted as a minimum requirement for their retirement income.
Why would anyone think it a virtue to exist on very little? Or think that living on the state pension is a “miserable existence”?

Hi, I retired from the NHS a few years ago, my NHS pension is £1208 monthly i don't get my state pension for another 2 years. My husband has state pension and a couple of small private pensions giving a total of £1150. We have no mortgage and run 1 car. We live comfortably. We eat out once or twice a month, I love the theatre and go regularly. Still have holidays. We never were big spenders but I am fortunate I don't have to worry about paying bills. We still manage to save most months. Remember you will have a lump sum too. Also in the NHS you can chose a smaller income and bigger lump sum. Alternatively you can choose a smaller lump sum and a bigger income. I spoke to a financial advisor and he said most people spend less as they get older. He advises take the biggest lump sum and the smallest . Everyone is different. I got free financial advice from the NHS and then spoke to my own financial advisor. Hope this helps .

My OH and I both had AVCs which have made a big difference to our defined benefits company pensions. They are a good way to boost pensions if one doesn’t start paying until later in life but it’s worth obtaining financial advice.

I don't honestly think any of us can advise you.

How much you need to live on will always depend upon your lifestyle and factors such as rent, utility prices etc where you live.

I never made a very good living, so living on a state pension plus two small pensions from the unions I belonged to during my working life has proved to be easier than living off my wages, but this is not due to the size of my pensions, but due to the fact that as retirement approach DH and I sold our flat in the middle of Copenhagen and moved to a small town near the German border.

Here the cost of living is far less if you live in the country than if you live in a city. If we had remained in the city, I shudder to think how many corners we would have to cut now.

However, managing on a pension is basically a matter of cutting your coat to suit your cloth.

I realise this probaby isn't the most helpful of answers but you really need to decide what you want to do in your retirement then assess whether your pension will permit you to do this.

If not, you will either have to revise your expectations, move to a cheaper district, or find out if there are ways of releasing equity in the property you own.

SueEH

“It’s not a virtue to survive on very little, but for many it’s a necessity, for others a choice. For many of us though, retirement includes doing the things we enjoy for as long as we can without financial worry, many of which which cost money. We could probably survive on a state pension if we had no option, but I can only speak for myself, I’d find that a miserable existence because I would not have enough to pay for my peace of mind regarding bills, and do the things I want to do, and I’m glad I worked full time into my sixties so I am now able to. I don’t understand why you are amazed that people have made different choices to your own, they aren’t wrong, just different.”

I don’t think I said I was amazed that people have made different choices to mine? I respect anyone’s right to make the decision which they feel is best for them. I made the choice that was best for me as my mental and physical health was suffering and I was not prepared to accept that any longer.
What I did say was that I was amazed at the amount of money that some people quoted as a minimum requirement for their retirement income.
Why would anyone think it a virtue to exist on very little? Or think that living on the state pension is a “miserable existence”?

It was the implication of ‘I’m amazed at what some people feel is necessary to live on’ that I took to mean you felt that others were profligate SueEH. I also said I would find it a miserable existence for myself if I had to survive on a state pension alone, I wasn’t saying that was the case for everybody, and of course some have no choice, and I do feel for them because it must be very difficult indeed. We all make our own choices, and I wouldn’t presume to judge others who make different ones

Missmoneypenny. Below is a link to the Citizen’s Advice Income and Expenditure calculator, I’m sure it will help you to work out how much money you will need, or where you need to cut down. If it doesn’t look as if you’ll have enough why not consider a little part-time job, not necessarily in your current field. You might find you will need an outside interest and it could help pay for little holidays. Good luck

www.citizensadvice.org.uk/debt-and-money/budgeting/budgeting/work-out-your-budget/

I retired at 58, no debts, no mortgage and had savings so managed on teachers pension for two years until state pension kicked in at 60. Yes! I was lucky as born in 1950.
Partner was working but he had a mortgage. I sat down and worked out my outgoings, food, council tax, car, insurance, holidays, energy, water, phone and realised I had enough. Plenty of clothes, shoes, boots are in the wardrobes. I think you will be fine as long as you budget and put a bit aside for a cushion . Good luck! I thoroughly recommend it

I would suggest building up your savings as much as you can over the next 5 years, while you’re still working. This is what I did and I happily retired a year before I received my state pension (had a works pension but not huge). The savings provided me with a buffer for any unexpected bills during that year and, actually, I didn’t need to dip into them much at all.

I'm 83, and have lived on one state pension + pension credit =£185 a week since my DH died 7years ago. I have no mortgage, and don't pay Council Tax, and get the usual dental etc concessions. I still drive my reliable old banger, just locally, and keep my independence, but will probably have to stop if my sight deteriorates any more.
How much you need in order to live comfortably depends so much on your lifestyle. My needs are simple, and my hobbies are inexpensive, so I manage quite well. I save a set amount each month, so have some savings to fall back on. As long as I don't have any unexpected horrendous expenses, such as needing a new roof, I'm doing ok.
From my point of view, your future income sounds fantastic, compared to my present one. I hope that things work out for you.

Do check your state pension forecast as it will be less if you’ve been contracted out. However you may have the option to buy extra years to increase the amount you will get, I was contracted out and even with 42 full years of NI contributions I still am not entitled to a full state pension. However I do have an option to buy more years to increase my state pension. It would be better to buy these whilst you have the income before you retire.

I only have my state pension it's more than I earned working you just have to live with in your means I have 2 holidays a year so I'm sure you'll manage on that I wish I got that much could have another holiday ha ha

Testing it is a good idea. Try living on that amount (or even less) now, no exceptions. Can you increase your rental income?

We too live in the SE.
We have no mortgage. We have a 2 bed semi rental property that we rent out.by 2025 the EPC must be C or above to be able (by law) to be rented out. Ours is already a C, so we are ok.
I'm assuming that you have had an EICR done on the property. That has to be done when each tenant changes, or every 5 years, whichever is shortest.
We have completely redone the bathroom 2 years ago and have just completely redone the kitchen, patio door and ground floor flooring.
The ceilings in the lounge and kitchen have both been renewed and have LED lighting in both. We also put in a new Worcester Bosch boiler this year when doing the kitchen.
Are you sure that your maintenance and any upgrading is up to date so that you're less likely to have big expenses for the next 10-15 years? Your money won't go as far in the future which is why we've done ours now.
We don't have a lavish lifestyle. My husband has a good works pension and state pension (he's 75) I have a very small works pension (200+monthly) and my state pension (I'm 73).
We are both happy and fairly content but are hindered by my poor mobility. This was caused by an Industrial Injury in School and it gets worse every year as I was warned that it would. I need to sit down every few minutes so going for walks is tricky as my speed is that of a sloth! Good job I've kept my sense of humour.
Good luck to you but doing a spreadsheet of absolutely everything and making allowances for cars and maintenance of both the rented property and your own home is something for serious consideration.

If your rental is a smaller unit, could you possibly move there instead and rent your main home out for more??

I’m ‘living’ on a state pension of £677 per month , since my husband has had to go into home for Alzheimer’s patients. His pensions went to pay for him. We own our home….it’s too big and too expensive to run.
But I can’t sell up and move to smaller placdd we as they would straight away take his share to pay for his care ( the council funds some of it!) between a total k and a hard place! Your fortune per mo th would be very welcome here. I’m 72 and haven’t been able to turn my heating on yet! So I’d say YES….your £1215+state pension + your husbands state pension is a fortune. I have a real choice ….eat or heat …when people say that it’s not a joke!

Oh …and yes…it is a miserable and cold existence!