Is living on the state pension really that bad?

I don’t think it’s necessarily true that expenses go massively down in older age. For example, my dad at 80 has just had some very big dental bills and has needed to do work in the house. He needs taxis as doesn’t drive anymore and has a cleaner. I don’t think you can rely on state pension to be enough if you need to maintain a house. Money at that stage buys choices even if your lifestyle isn’t extravagant.

My granny only had old style state pension and was pretty poor and was frugal in how she lived other than running a car. My parents definitely helped her out financially. One of her wealthier friends gifted her money in a will and it made a massive difference to her in her 80s. You don’t really think about inheritance coming in your old age but her friend could see she didn’t have much at all and that gift really helped her.

My parents had that plus very small private pensions and money from downsizing their home. You need less than when working, supporting a family etc but it depends what sort of lifestyle you want. I think most people would need a small part time job or private pension on top and some savings. My mum and dad also moved to a holiday place and didn't go on holiday very much, instead. If you want to travel you need a lot more. Think of how long you intend to be retired for as well. They had 20+ years together and managed their money pretty well.

You're right about the lower cost homes. My sister is currently in a council run home due to her challenging dementia. The care she gets is excellent. The staff and managers are approachable and have a SOH which is needed as her language is ripe , to say the least! The downside is that council run care homes are few and far between.

Everyone can't be shift leader/manager! Many people do work all their lives on minimum wage or not a lot more. It really isn't true that anybody can earn a fantastic salary just by working hard/improving themselves. In the real world, lots of people will never earn huge salaries.

Of course not, but you don’t know if you need it until you actually need it or you’re dead and won’t need it. Life can change in a second.

Home maintenance would also be an issue. What happens if you need new windows or a new roof?

If you are happy to live with just the basics I think it could be okay for food only. But if you want to be able to go on holiday, buy clothing, have memberships like gym, netflix etc. These things all add up.

I don't think 'many' people do this. Some do and probably more than did a few years ago as rates have improved. But most people will leave their money invested and draw an income. So it's not just £300k, it continues to grow.

Anyone in a defined benefit pension should almost always put money into that pension, not elsewhere.

Defined benefit pensions are worth their weight in gold.

My mum struggles with her OAP and a very small private one - about £100 a month - which means she gets no benefits.

No mortgage but other bills add up
Gas
Elec
Water
Broadband
TV licence
Council tax
Car insurance
Petrol
Cat tax
Holiday insurance (covers UK trips and Europe)
Food
Savings for holiday
Savings for Christmas/birthday
Savings for car repairs
Savings for house repairs

You need to calculate what you need and plan accordingly

What's the difference between buying an annuity and just making additional contributions into an existing company pension (say local government)?

A friend of mine who is a teacher told me that for every £8K additional lump sum contribution she makes into her works pension she gets back around £500 per year for life. Clearly she'd have to live longer than 16 years after retirement to get her money back... Sounds like a pretty good deal, if true.

I intend to downsize once my kids fully fledge. No mortgage, only paying for my own gas, electric, water, food, small car, some savings each month, cheap holiday etc, on £1000 a month I'll have a very similar standard of living to what I have now. I do have private pensions but they're relatively small due to time out of work due to kids and chronic illness.

You can survive on it for sure, but it's a long time to live on the minimum.

My mother in law has no personal pension, just state pension and pension credit. She hasn’t had a mortgage for many years now, she’s 82. She runs a small car, goes on holiday at least once a year abroad and says it’s more than enough for her to survive on.

She is by nature very frugal, doesn’t eat vast amounts of food and doesn’t drink or smoke. She buys in charity shops and gets some real bargains, and sometimes sells them on eBay or vinted and makes a bit of extra money.

I also always wonder. If we are lucky enough to have mortgage paid off, no debts, decent car, some emergency saving in case of inevitable…is doesnt seem that bad to be honest. Two of us could get £1.9k monthly, you can easily save from that. Not much but enough for a holiday once a year.

but life is life…above is fortunate position, you never know what you will need money for besides bills and food.

That's true but over 65 isn't really that old. I think the over 75 or 80 figure is more important and will show a much higher level of need.

This. As we age, our teeth tend to require expensive dental work and it's not free for pensioners (despite what some people assume).

We needed a new roof two years ago - many thousands, which we're well enough off to pay for. If we were simply on state pension with no savings (and there are a fair few pensioners in this very position), it wouldn't be possible.

Even paying for new white goods when they break down would be beyond the reach of someone on state pension alone.

Well, many younger people cant afford to get on the property ladder and rents usually higher than a mortgage so for them there's that.

Then theres the age at which you get it. My parents retired in their late 50s, my grandad raised two children, built savings and owned a home as sole provider, my other grandparents were the same. And my grandparents got their state pension at 60.

Then theres miminally - council tax, gas and electricity, water bills and food. Which I think could easily be £750 a month.

Most people reasonably want more: Internet, TV streaming, phones, cars (which come with insurance, fuel, MOT and tax) pets (which come with insurance food and vet bills) new clothes.

Before you think about occasional trips, presents for birthdays, christmas, maybe a holiday.

If you own a home you can probably survive on state pension. Just.

Even with your own house you need to be able to maintain the house, buy new white goods as and when, cover vehicle insurance/repairs/tax, cover christmas birthdays, relatives big events... weddings, landmark birthdays, baby. Glasses get expenses as eyes need more help. Teethstart needing money spent on them.
Big heating bills. Also holidays or weekend away is quite a stretch. If you live quietly then its possible. If you want a life then not easy. Also what you get in private pension will virtually all go in tax....or reduced pension.
Unless you have a large private pension its a much reduced lifestyle.

If people have been working then it's likely they will have a private pension.

The original pension was paid when life expectancy was much lower, now that medical care has extended lifetimes, it's unaffordable. If you want a better than "basic" lifestyle at retirement then you need a private pension.

The state (i.e tax payers) cannot afford more than "basic" as there are many more people receiving pensions.

I agree. Let’s hope they don’t take it away.

Hmm that’s some people - I personally don’t see 74 as very old !!

At 74 (all my aunties around this age)

they all have a very active social life - meeting once a week in the pub for their dinner and drinks

all heading the theatre basically every other week!

my 73 year old aunt flew from Dublin to London for one weekend just to go to the abba show with some friends

my dads 70 and he’s in the gym 5 days a week and if he’s not there he’s on the golf course or in my house doing diy bits for me

he took my 4 year old to Disneyland for a weekend by himself on the Eurostar

there’s no way he’d be happy sitting in watching tv as his life any time soon.

my nana was still very active until she was 100 no way she have sat in happy with a quiet life in front of the tv either - she had a routine of being somewhere each day of the week (pub lunch Tuesday, coffee in the park after mass with the church friends another day, into the city centre on Wednesday, and come on holidays with us some years ! Never slowed down until she died

This is Mumsnet, people are obsessed with ' pension pots' to the point you are supposed to scrimp and save in your healthiest years to have hundreds of thousands for an uncertain future.

Two people living on £500 pw in a house with no mortgage should be very comfortable , unless they were planning on cruising round the world for 6 months of the year.

If you want to live modestly, have some hobbies, put a bit away for a UK summer holiday and a nice Christmas, it is more than enough.

I've often thought the same as the OP. At 65 I will be ready to have a quieter life and that amount of money would do me and DH nicely.

If we need care, care will be available..it doesn't need to be luxurious private care, just functional.

My dad is always saying he has more than enough ! He has a small private pension also but has plenty to live off, buys all his food form M&S etc !

Well, I pay full rent, and get no top ups, so I’m glad of my private pensions.

A thousand pounds a month might sound good, but there’s still utilities, council tax, etc etc to fund.

Although I would guess the majority just on a state pension would get some pension credit which helps.

I work in benefits for older people. The vast majority over 85 seem to have health issues and claim Attendance allowance and all the extra pension credit etc that can come with that. A lot of it just builds up in their accounts and they are amazed by how much they get. To be honest they really aren't doing badly. It's the ones at the lower end of the age spectrum that are struggling if they don't have a private pension or qualify for pension credit.