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 :)

This is interesting. I went through a bad divorce 10 years ago, and did not have a financial settlement til 2017. This really upended my retirement planning. As a result of the divorce, I got into the habit of tracking all of my expenditure, which is really helpful and I recommend. I keep every receipt and cross check with credit card statements.
My retirement income consists of the state pension, a small US social security pension, draw down from a ca £250,000 private pension, a rental that earns £650 per month. I deferred my state pension for around 6 years so I draw more than average, and it means when there is an index linked increase - as is happening in April, I get proportionally more. I am earning pre tax about £3000/mo. The mortgage is paid off.
I still have to be careful. Running a house is expensive - energy is currently £258/mo & council tax £260/mo. We are very conservative with heating & run washer in the middle of the night when tariffs are lower.
The difficulty with the aforementioned calculators is they don’t take into account unexpected costs- I had a £1100 car repair bill in Jan, & hope my appliances, boiler, roof, etc won’t need attention.
So while I have a fair amount of wealth (house £700k, SIPP £250k) my earnings are fixed. Due to divorce I lack a savings cushion, I have ca£10k, but £50k would be ideal. My budget allows for eating out once a month, and I have to budget carefully for holidays. I have had one so far this year (£2k) and I might take another, if I can afford it.
I have a partner, we share expenses but keep our finances separate. The house is mine. If he predeceased me I would sell the house as it is too big for one person.

Well we habe ex pubkic seevice pension- - in total 24 kn but we are 60 and not got state pension yet

What is the advice please on deferring state pension? My husband has done this and is now 72. When is the best time for him to ask for it?

Nobody can tell you this. If we knew when we were going to die and knew what the goverment were going to do with pensions in the next 25 years we would have the answer to this. I deferred mine for a few years but then decided that the government may change pensions yet again in the next 10 -15 years and I wouldn’t necessarily get any benefit from deferring.

I thought there was no longer any advantage to deferring the state pension? One used to get more the longer one left it, but I think that no longer applies since a couple of years back.

I'll be doing equity release to top up my pension. Working part time during the primary school years has had an impact. I chose time not money. Wanted to be there for DD for pickups and friends round for tea.

She will inherit at least half the value of my house when I pop off. I think I'm entitled to a bit back.

Just to add to that, I think you don't get anything extra, just the same amount you would have got, but you get it for a shorter time, so you get correspondingly more per year. In the past there was an inducement to defer.

Money Saving Expert Says:
If you defer for a full year, you get 5.8% extra, which is £11.82 a week.

On current figures, a one year deferral would net you an extra £614 a year on your state pension, for life. Yet, do note that to get this, you'll have given up £10,600 in state pension that you could have claimed in the first year.

In general, if you defer for any amount of time, you'd need to live for around 20 years after taking your state pension to even out the amounts... which is around the time an average 66 year old is expected to live.

It would seem (to me)then it's worth taking the state pension straight away and getting the benefit of it while you can use it, especially as it is index linked.

Because this speaks to a comment about 2 retirees on balance being better off than singles. Do people continue with life cover into retirement? Ours will expire when I am 60/DH is 66 and the mortgage is paid off. My death in service is 8 X current salary and I have a range of DC pensions and 1 X DB pension. DH is already retired with one crappy pension. I am just about to be made redundant so will lose that boost (2 young adult but dependent DCs). TIA

It is worth diferring if you are still working because if you are still working you would pay tax on it.

We have continued with it ( even although divorced) as it was started initially for child to offset inheritance tax. It is only 44 a month ( total) so feel worth it for us.

Blimey reading these in shock!
I dont earn anywhere near these amounts now never mind when i retire, which is in 3 years time if the age isn't hiked again by then.
Private pension + state pension will be approx £1,300 per month, if im lucky, i could live on this easily but i have no mortgage, i intend to down size my home this year which will hopefully give me a small savings pot and buy me a newer car, i also, health willing intend to keep working a day or two a week, although ive got to say am ready to retire now.

£3,000 a month is enough! I have never earnt that and paid a mortgage and brought my daughter up on around £2,000 per month. What are people spending it on?!!!

I'm still baffled as to how 3k is spent on just one person. We have bills like that and support 2 kids. I honestly would love to know how people manage to plough through so much when it's just one person.

@5thcommandment, not sure I understand this?

(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.

So if bills/ living expenses are say £2k per month
£1.4 m pot?

Not quite. You need to do

Bills x (1.025^25) - ie 1.025 multiplied by itself 25 times, on the calculator function on a phone it looks like an x with a little y next to it - to work out how inflation will have impacted over 25 years. £2000 bills now will be c. £3700in 2049 if inflation is at 2.5% annually. £4700 with inflation of 3.5% per annum.

Then you need to multiply that by how many years you expect to live post retirement, assuming that the interest which keeps accruing roughly balances out the continued inflation.

hi to everyone else reading about these 3 grand a month pensions and shitting themselves.

Mine's forecast to be £393 a month and I'm sure I'm not the only one!

(back to my 45p Asda essentials white bread sandwich lunch)

I agree with those saying 3k a month is more than enough, and also question how anyone is spending more, unless their bills need looking at and they're very extravagant.

Our bills total £700 a month. If we can't feed and entertain ourselves on the remaining £2300 then there's something wrong.

I am SO grateful we are in this position and very mindful that others raise families on far less.

To answer a couple of questions, I deferred my state pension as I was working until 70 in my own business & drawing an income from it. For me it made sense. The best advice on this you can get is to contact DWP. They will send you a letter with a comparative analysis. I will be getting £281 a week in April, well above the normal state pension.
I didn’t list all my bills, but I mentioned that I kept a detailed spread sheet of expenses. Out of £3k gross, (income tax = £275) one needs to deduct food, water & sewer, insurances, cosmetic & pharmaceuticals, home expenditure, gifts, petrol, entertainment, books, coffees out, subscriptions, and so forth. Depending on your hobbies & lifestyle, it adds up.
I don’t doubt that some get by on £700/mo, but council tax & energy for me are more than £500/mo, so £250 wouldn’t go very far!
I strongly recommend monitoring your spending to the penny. You would be surprised.

Travelling while still able in my case. We do 4 holidays a year. I also buy quality clothing , make up etc. I eat out twice a week with friends at lunchtime. That has certainly got more expensive over the last couple of years since Covid. It is certainly cheaper though as a twosome to travel and live. I also try to keep my "rainy day fund" topped up as well.

Unfortunately, due to divorces in later life becoming increasingly common, many of us have mortgages that go well into old age. I divorced aged 49 and had to buy my ex husband out of our house. As a consequence, I won’t pay off my mortgage until I’m 76. It’s currently around £560 per month.

No idea why people on here are telling other adults that they're spending too much of their own money.

I don't think they are. I think there is just confusion about where it goes given that so many spend so much less.

Oh dear -you appear to have made a school girl error of assuming our energy bill is somewhat wasteful? Or can be reduced.
FYI we live in the countryside with no mains gas so we have a fully electric boiler ( which will become a regulation in the near future) and is greener than oil and gas anyway. Our heating comes on twice a day at 15 degrees and we use a modern, efficient wood burner also. We also charge a fully electric car and a hybrid car on the system so doing our bit for ourselves and the future.
People have higher energy bills for all sorts of reasons, including running life saving medical equipment!

Thank you Brionotbiro and Moanranger for your help.

I'm currently on 50k and my current teacher pension at age 50 is 14k so far.

I'm adding 850 per year to it as it Asda 1/57th if my salary to my pension sum per year,so teaching til 60 will take my pension to about 22k if I stayed full time.
And I'll have approx 2500 per year from my avc.

I'll also have about 50k lump sum which will help for the 7 years til state pension kicks in. And also to make up for however much the 11 years of pension I will have accrued since the change of system in 2022 is reduced due to me going at 60 not 67.