Pleasantly surprised how cheap retirement is..

[Reproician]

Two years ago I was earning £70k and living very nicely on it.

Then stuff happened and I decided to take very early retirement. I have good pensions to come in 5 years' time, but meantime have some casual work which earns £4k pa and investment income of about £12k. I planned to live off savings to fill the gap and budgeted up to £20k pa.

Now, I realise I am very fortunate and I am definitely not claiming poverty. I realise being well set up and then moving to a lower income is entirely different to a lifetime lived on a low income. My mortgage is paid off etc, but I am finding I only need to draw on the saving for one off big purchases. I've drawn £6k altogether in 2 years.

I'm still living a good life. I still spend without thinking to hard on the things I want, I still have a busy social life, I still travel multiple times a year.

Being able to be fully flexible means everything is cheaper. I can at the time of the week/month/year when flights are cheapest etc. And the money I must have been spending on clothes, food, travel for work etc. PlusbI think when you're working hard there's a tendency to spend on "treats" that you don't feel the need for when lofe is.lore relaxed.

Just me and an adult son at home. He pays some keep, but I don't make any profit out of him.

My mum takes a cruise for a third of the year costing £40 k plus several other holidays but claims to be missing the winter fuel benefit, says she’s worried about the triple lock going and pleads poverty at every opportunity. She’s been doing these cruises for 10 years now.

Ps she worked at Sainsbury’s and we grew up in a council house. Think she inherited her 3rd husband’s pension. (Glad this is anonymous! 😂)

Oh, we're here! It usually seems a bit pointless to comment, though. You can find us on budgeting threads (trying to be polite to posters who think lentils and handwarmers are all old people need for a happy life).

With regards to the 'comfortable retirement on £45k figure, it comes from here:

https://www.retirementlivingstandards.org.uk/

If you add up the parts they give figures for, you can deduce the amounts they are withholding.

I've added up the listed costs and it comes to just under £20k, leaving £25k unaccounted for. The unaccounted costs are:

• streaming services
• 3 year old small car that's replaced ever 5 years.
• 3 long weekend breaks in the uk (excluding spending money, which is accounted for).

I can't see how those items could possibly come to more than £10k a year.

I also take issue with the cost of the holiday in the med. You'd have the luxury of going off peak and you can get some amazing 4 star and 5 star deals for a fraction of their budgeted costs.

I retired early and DH retired at 60, 20 years ago. He's got a good state pension and some SIPP, I have a smaller state pension and a very small occupational pension which pays the council tax. We've got some investments, but are certainly not what would be termed well off.
We've downsized and bought a flat which we've had thoroughly renovated. Living in general costs less, we eat out once a week and run two newish cars. One expense that is higher is the management charge for our flat, but we'd probably pay more for maintenance if we were still living in a house and getting somebody in to do the work.
One expense which we don't have is holidays because we don't want to take any as we're happy with our life and want to stay at home.

I'm very, very pleased for you. Life isn't all bad! I hope you have many contented years to come.

Great you nearly have my income whilst you do fuck all im working until 67 as my health took away my career and no I dont get benefits and payed into pension for years you are very lucky

My Financial Advisor said that it drives him mad - people too scared to spend anything. I remember when I took early retirement being told that you are better to spend during your 60s because from mid 70s onwards you tend to spend much less. I remember my late father in his 80s having so much but not really using it for anything. I have investments and savings but I enjoy spending my money - this is not the age for scrimping unless you are struggling obviously. I have been retired for 7 years and I have just 2.5 years to
my state pension. So far, so good money wise.

I'm glad for you. However, this is not true for many of us retirees. I became disabled and lost my career. I didn't pay enough "stamp", so I'm on a reduced pension. I am truly struggling to decide between putting fuel in my car and cutting back on trips, or fueling myself with nourishing food. The costs are continually increasing, and I can assure you that my pension is not keeping pace.

Sorry...what's the point in this other to boast?

My DH is managing fine on half that, and he’s always out and about. Certainly doesn’t scrimp on anything.

I can’t believe people find this frugal! 19k is more than most people have after rent/mortgage payments in the UK.
Eg, I’m in 30k so 24k after tax. I pay a small amount of rent as I share but definitely brings me to under 19k, go abroad twice a year or so and eat out/go to bars all the time. I stopped my online shopping addiction but I also have commuting costs and am a nightmare for a takeaway coffee or meal deal at work. I do just fine! I think this thread is for rich people 🤣

I moved to the UK from Asia and don’t understand how people can plan their retirement nowadays. NHS provides low quality service so I don’t know know how people are planning to survive till they can retire.

Have been thinking about this. I’m in a London commuter town and Uber is never more than a few minutes away. I reckon I spend £400 a month on running a car all in.
It’s appealing to think of using public transport or walking then just using uber whenever I feel like it.

@CuriousElephant @Hereandthereandeverywhere As usual it's a "let's cut the triple lock" thread because some pensioners saved a lot into their company pensions and are therefore not living on the poverty line. So they are paying 20% or 40% of their state pension in tax.

Let's just ignore the 1 in 6 pensioners living in poverty and the unknown number just above that level.

Single pensions median income is £16,536 p.a and married couples median income is £31,304 p.a. But lets pretend that the people posting here - all of whom are, of course, totally honest - are the norm.

I semi-retired in January to work from home at 55, and the spending seems to be balancing out about the same. I spend less on food, clothing, and transportation, but more on the benefits work used to cover. In any case, I'm much happier now, which is the real pay off. "Technically", I'm too broke to be doing this, but it's been working so far.

With respect, of course retirement is going to be easy if you were rich beforehand. We can all assume that’s the case. I’m not sure what is the point of this post. If you were not rich beforehand it can be tough financially but of course not having to work can be a joy in terms of freedom of choice. You have time to go the library, see the dawn, enjoy giving time to pets. However, psychologically, one has to come to terms with ageing which can be daunting, but again, a privilege many didn't/don't get.

My parents were cautious and frugal all their lives. Mum died at 62 and dad lives on their combined pensions and assets. He now saves £30k a year from his pension and is still frugal and cautious in his 80s. It’s hard to change sometimes. Always waiting for the time you’ll need that money! Not a tragedy because he honestly has anything he wants and needs from about £18k.
Agree with all. Retirement can be very cheap if you’re not a spender by nature.

I retired early from teaching and was very pleasantly surprised just how cheap I could get flights to Europe out of school holidays. Also AI holidays at short notice were about 30-40 percent cheaper than in terms time. No wonder so many parents pull kids out of school to go on holidays in term time.

Well that’s nice for your mum - but you must know that she’s a bit of an outlier. A extreme outlier in fact. Quite a few people on this thread have given examples of much, much cheaper ways to travel, and they aren’t pleading poverty.

Gosh yes! The change from a saver to a spender is a strange mental adjustment.

We 'retired' 5 years ago, but I still did some hobby work that brought in about £10K - paid for holidays, plus a very tiny inheritance that we blew on a single trip. I've deliberately downsized that to about £1.5K income (still doing it because I love it) which means we're 2 years off state pension age and using our savings to fund our lifestyle. It's the right thing to do, but it feels so scary to be looking at decreasing savings. In that time we had a planned purchase of new carpets, and unplanned purchase of a new boiler, and an unplanned roof/gutter repair - all a bigger dent in our savings than we'd expected. Even though I know there is nothing at all to be worried about. It's an 'about turn' in 50 years of adult financial approach.

My best friend, younger than me, has a health condition. She retired early and is living on about £1,200 per month, using her savings for things like replacing a washing machine etc. But she manages well, eats well, cooks at home, goes out sometimes but to well chosen places.

not that much of an outlier as the cruise ships are full of retirees taking extended cruises.

Life is pretty chill when the biggest single expense is sorted and paid!