Is anyone going to be living just on state pension when they retire?

[Shinyseas]

It looks like I will be. Never really earned enough to put money aside for a pension, married someone who was terrible with money and at the age of 51, have youngish DC so even though I’m earning better money now, I’ve got to get them through teenage years, then off to Uni. All feels too late to save anything decent. I’ll be early 60s before my youngest leaves home.

When I checked this week, my private pension is set to give me 1.5k a year 🙁

People do survive on the state pension I know - but it must be very very tight.

My MIL is trying to survive on just a state pension and it’s a bit miserable. She won’t claim pension credit. She is going to sell her house and downsize and relocate to us as much cheaper where we live but doing that at 80 is taking an emotional toll on her.

Go on @AngelinaFibres , why is that?

I have worked full-time most of my life, since I was 16 and this has been the scenario quoted above has been the case for most of my life. There has always been too much to pay out for to put money aside each month into a pension plan. This is a combination of fairly low paying jobs, being single (though now married), no family support or financial help. I've just got two years more payments to make to make my full contributions to SP. I really have learnt to stop worrying about it. What will be will be. I just think I may not live until that long and whether I do or don't, I don't want to waste my 'younger' years stressing over it. There is some comfort in knowing I'm not alone, though!

State pension is not enough to live on. Mine works out at about £850 pm. which is more than others get. Luckily I have other sources of income but I shudder to think how people manage otherwise.

That is worrying. Are the rules about qualifying really complicated?

Please teach your children to start early. Our feckless education system cannot be relied upon to teach children the stuff that really matters like pensions, understanding/avoidance of credit, tax and legal tax avoidance, basic cookery and DIY, avoidance of student loans for anything other than STEM/income generating employment opportunities, etc.

Exactly. Full state pension is around 9k a year I think. Many will have double that if they have a spouse. If people are still renting they can get help with rent even if not eligible to pension credit. If disabled they will get PIP or attendance allowance giving them extra pension credit or making them more likely to be eligible. It's people that go into retirement with debts and big mortgages that struggle. I see a lot of pensioners in my job who have ridiculously bailed out their adult kids and left no safety net/ savings for retirement then suddenly become too unwell to work for as long as they thought they could, or those who have extended mortgages etc to help kids get on the housing ladder. These are the ones who struggle. As others have said it's all about good planning and being sensible.

That £8000 is tax free though.

it’s enough to live on. It may not pay for a life of luxury, but it’s enough to live a reasonable enough sort of life.

If someone posted on here that they had nearly £200 a week to live on and that they had no rent or mortgage to pay, there would be a lot of YABVUs and the like.

I could live on that fine if my mortgage was paid off. Not a luxurious lifestyle but I could afford bills and food.

State pension intentionally provides a very basic standard of living, it would be unreasonable to expect it to fund anything else.

Anything above must be self funded via work, savings, downsizing or private pension. How can it be any other way?

This is why we must go further ensuring everyone pays into their private pension from day 1 of work and doesn't consider it optional, same as tax and NI. It's money you never have available to you.

I think a lot of older people run into problems trying to maintain mortgage free homes in retirement especially if older homes. I see a lot of run down homes around where I live and all owned by older people who cannot afford to maintain them.

Working in some capacity part time could be a good option. I'm in my mid 60's and know a retired pilot who is a part time van driver, an art dealer who gave up his gallery but buys and sells still and my DH who was a full time civil engineer now works 2 days a week on a heritage project. They all say it helps you feel useful, and part of society, and of course the money is useful. None of them need to work financially but chose to do so at the ages of 75, 82 and 67 respectively.

@CharSiu, 80 is a tough age to downsize. The advice is to move earlier when you are more able. I think mid 70s at the latest.

Companies previously provided good pensions (defined benefits) so the idea of being poor when elderly didn't register for quite a few people.

It is absolute worth prioritising a pension, any amount you can save as with tax relief and long term (10 years) it adds up.

Op, what does your employer contribute?

I intend to work as long as possible as I fear my private pension will not be up to much either as I only started it at 43 due to being self employed and irresponsible!

@Waxonwaxoff0

I could live on that fine if my mortgage was paid off. Not a luxurious lifestyle but I could afford bills and food.

Even when you become a little less energetic- you need to pay to get the grass cut , the windows washed , you start to really feel the cold , getting old seems to bring additional expense

Easy to say, not so easy to do if you need every penny to survive right now.

My aunt was left quite well-provided for by her husband. She lives in a complex, is mostly self-sufficient but needing more help as time goes by. She has bought her apartment but, even so, the costs she has to pay out each month for the privilege of living there, all the extra charges are mind-blowing.

That's why I have fake grass. Low maintenance house and garden.

I don't agree that it's down to schools to teach about pensions and everything else. We all need to take responsibility for understanding it ourselves, and passing that knowledge onto our children. Or if you don't understand, knowing that there are places like money saving expert as a starting point.

Our children have pensions. They have had pensions since they were born. We started off paying £10 per month per child but that has increased over the years as we've had more spare cash. But even at £10 per month, the joys of compound interest gives their pension a big kick start.

I think that this is what baffles me a bit about MN - pensions can only be tapped into when you retire, which for most of us won’t be until our 60s.

I don’t want to live a life of restriction, misery and frugality in my 30s, 40s and 50s so that I can live it up in my 60s!