If you are retired and have a good life, can I ask how much pension you draw?

[User5512]

I tried some calculators and they all gave me vastly different numbers.

I’d like to know (roughly) how much money does a couple need to have a good life in retirement.

If you are retired, would you be kind enough to give me a rough idea of your lifestyle and how much pension you get?

thanks :)

Good for you - but imagine when one of you is no longer there - most couples go down to singles at some point in their life. The average pension for a single pensioner (if relying on the state pension anda small other pension) is roughly half.

Your income is halved but your costs are not suddenly halved when you consider the basics that must be paid (except for the 25 percent off the council tax. ) and perhaps a little less food costs.

Reading this and a few things stick out:

• most people don't understand your retirement is your responsibility, you need to plan for it
• the state pension is a) peanuts, b) only available at 66 rising to 71 in due course, c) likely to be means tested in future because it's so bloody expensive.
• people need to save a pot that represents enough to pay what your bills will be when you retire excluding mortgage (assuming you've cleared it). If you're due to retire in 25yrs the math is:

(bills x 1.025) x25.
That tells you what your bills will be in 25yrs time with 2.5% inflation each year as an average.
Then multiply that annual figure up by 30yrs (your pension period.
That's how big your pot needs to be as a minimum. Then work back how much you need to save/yr to get to that pot.

• Another way is 2/3 of gross salary but it's less scientific. Perfectly doable if you plan, the problem is most don't and then blame someone else and rely on the state.

• everyone should start contributing into a pension from 18, no excuses. Then a million £ pot is easily achievable.
• contribute half your age as a percentage, more if you can or are starting late. Put bonuses in there so you take them as gross.
• aim to only draw down 4% of the pot each year.
• save anything else into ISAs, not bonds.
• state pension as a top up if it still exists.
• NI contributions are not just for pensions, that's a common misconception.

A few millennials moaning in here. I'm. Sorry but Get a grip, I'm a millennial, married, home owner, I've been aggressive with my career and now save 40% of my salary into pension. Work hard, move jobs, get promoted, save. Aiming to retire at 58, I've made a plan and study/actively check my pension almost daily. Rather than moan, educate yourself and plan ahead, frankly it's no one else's responsibility.

Genuinely wish all the best of luck because the government is not going to lower the pension age, only raise it. Rely on yourself.

It depends what you spend. I have a small private pension of £400 per month, DH is retiring this year on a pension of £2250 per month. We are not eligible for state pension for another six years so will dip into savings if we have to for any big unforeseen expenses. We used the Money Savings Expert budget calculator (MSE app). It’s quite detailed and was a huge help in planning for retirement. We update it every 3 to 6 months to keep an eye on finances. We live pretty well, run two cars atm, take holidays - not 5star but not camping either! We paid off the mortgage thankfully so just need to keep an eye on utility and food costs. I’ve been surprised how little I can live on having previously earned around £3000 per month. I budget for Christmas spreading the cost over the year. I’m currently saving to go to Australia with my DD by selling the business clothes/ shoes etc I no longer need! When you tot up your outgoings just be honest and realistic as to what you need as an opposed to setting expectations too high. I used to think nothing of making expensive purchases, now I tend to shop around to get a good deal. We also sat down and worked out our Plan B if money became tight. Making small changes like cutting outgoings through to downsizing if we really struggle. It was daunting at first but we are now confident that we have control of our finances so can relax and enjoy retirement.

@Doyouthinktheyknow pensions have been changing in the private sector for a long time.

Almost all have been DC schemes for the last 15 years or more.

This is why it is so important for workers to be pension-wise. When looking at a job offer, think about pension:

• is the bonus scheme, car allowance, commission pensionable?

• how much is the employer putting in?

Don't just look at the salary.

Now all workers are expected to have pension knowledge which an awful lot don't have. They are given the freedom to decide between draw down pensions and annuities but nobody explains the differences unless asked. But you have to know it is a question to ask.

Oh absolutely agree, we all need to change the way we think and plan for our retirement!

But the people on this thread with very large pensions seem mostly to be those retired now or retiring shortly so they are the people that have benefited from much better pensions than anyone going forward could ever dream of.

What side was the programme I missed and what was it called please? (I’d like to watch it on catch-up) TIA!

Me and my husband currently have two private pensions and one state pension, I'm not state pension age yet. We live,for us, a comfortable life,no mortgage and get £57,500 net per annum.

@Doyouthinktheyknow I think the majority of the super-size pensions arent DB schemes. They are from tax efficient savings and investments. These have always existed it's just that MN gives us a view through that lifestyle window.

When I started work in the late 80s, pensions were much less regulated and clear than they are now! A lot of pensions in the private sector were not necessarily fully funded. They might be final salary but some of the pension was in fact paid by the current employees.

There was little regulation of how any pension fund was invested. This led to a number of scandals (eg Mirror Group & Burlington's) where the pension fund was used to prop up an ailing company. We knew people who were caught up in this and lost most if not all of their pension.

A few people did do well out of that lack of regulation - people would be pensioned off in their mid 50s rather than being made redundant. The company saved the cost of redundancy and the pension scheme picked up the bill.

Auto enrollment into pensions schemes only came in 2012. An awful lot of people fell between the cracks. Didnt realise they needed to prioritise pension contributions and their employer wasnt paying in anything. These people are now working in NMW jobs to top up their pensions.

People always have options in life. It is up to an individual as to how they manage these within their individual circumstances.

We spend a lot more than £130 a week on food. I know we could economise but we like what we buy. On the plus side I never buy takeaways as I just don’t understand what people see in them: semi warm greasy food.

I'm not criticising people who spend a lot. its their choice. I just think calling 130 for 2 'comfortable' is inappropriate. It's clearly luxury.

We don’t buy champagne and caviar!

I didn't say you did! but there must be some luxury items or brands, organic. Something must account for you spending twice as much per head as us (and we eat well).

I find the numbers bandied around as what's required for pensions genuinely astonishing.

The sums in the retirementlivingstandards.org are really quite considerable.

I have paid off my mortgage. I live in a small, two-bedroom terraced house. I run an (old) car, and I go on about 4 holidays a year, all foreign. I have a cleaner and a gardener, and an expensive gym membership. I buy nice food and eat out regularly.

I don't commit myself to significant car lease payments, buy large amounts of expensive tech or spend anything on beauty, and comparatively little on clothes.

On an income of circa £3000 a month, I save around £1900, of which £200 goes into a holiday fund and £200 into an annual expenses fund.

So overall, I spend circa £1500 a month on a frankly really quite extravagant lifestyle.

That's still only £18,000 a year which is barely above what they reckon is a minimum you need. The numbers just don't make any sense.

And how much are your bills?

Yes, I’m aiming for half my pre retirement income and think I’ll be ok with that. My main issue is that I’m likely to have only my pension/income for most of my retirement as dh is quite a bit older. It must be so much better with two pensions.

Gas, electric, water, internet about £200
Council tax £100 (£300)
Other regular bills e.g. Phone, streaming services, car tax, prescription prepayment certificate and things like that: £75 ish (£375)
Insurances (about £50 a month of annual bills) : £65 a month ish (£440)
Petrol: £50-£100 depending on the month (£490 to £540)
Cleaning and gardening: £210 a month (£700 to £750)
Food (exc eating out): £200 (£900 to £950)
Holidays: £200 (£1100 to £1150)
Car repairs (annual bill): £50 (£1150 to £1200)
Gym membership (annual bill): £90 (£1240 to £1290)

Which leaves about £200 - £250 a month for eating out and other expenditure. £250 ish extra out of the leftovers from the annual bill account to top things up for Christmas.

Of that, £700 or a bit more is "luxury" expenditure.

It wouldn't allow for large expenses like replacement carpets or a new car out of income but I have assumed that sort of thing will need to come out of capital once I am retired.

I love this level of detail buy blimey your council tax is cheap for a 4 bed house! ours is 290 (also 4 bed)

@literalviolence she lives in a 2 bed house.

@Papillon23 what does this mean ?

Council tax £100 (£300) - do you mean you pay in 3 instalments?

I don't understand this either

Insurances (about £50 a month of annual bills) : £65 a month ish (£440)

In fact I don't understand many of your calculations.

It was a running total

Still not clear -
how much is your annual council tax - 300?
how much is your annual insurance ??

CT: £1200 (£100 a month)

Insurance is about £65 a month so £780, of which £600 gets paid out of my annual expenses pot.

If you look, the sums in brackets add up to the total of everything before plus that line.

Thank you for explaining. I see what you mean now. I am dopey!

Ah. I got confused. That makes more sense!