Is living on the state pension really that bad?

[cateringday]

I mean, if you own your home then you’re getting around £250 a week just for bills and spends.
i have a tiny pension and DH has none. I am always worrying about this but then realised that we will have no rent or mortgage to pay.
im just wondering if it would be as awful as people make out? I hear stuff saying you need £300000 in pension pot to have a comfortable retirement, why would you need that much?

Many pensioners (I think around one in eight of all pensioners and one in five of single pensioners) rely on just the state pension and pension credit.

Yes, you certainly can live on a state pension.

"I hear stuff saying you need £300000 in pension pot to have a comfortable retirement, why would you need that much?"

Many people will use their pension pot to purchase an annuity (a regular monthly payment). Incidentally, up until 2011 it was compulsory for everybody to purchase an annuity with their pension pot.

For example, I am 60 and will retire at age 67 and am in generally reasonable health. If were to use a £300k pension pot to purchase an annuity to start when I retire then that would pay out £16k per year if I wanted it to increase with inflation or £23k per year if I were happy with no increase.

So a £300k pension pot could give you between £16k and £23k per year on top of your state pension. The lower figure would give you a total of £16k + £12k = £28k. You will have to pay some tax on this and would have a take home of just over £2,000 per month.

I did say as a couple to be fair. I said £800 for bills (excluding savings/ birthday etc admittedly). As a single person that £800 would drop slighty given reduction in food, i admit as a single person it would be significantly tighter.

Currebly as a family of 5 our bills, excluding savings/holidays/birthdays, are £2300 and thats with a mortgage and car finance hence why I cautiously said i had wondered how bad it would be.

You do know there are people working FT with mortgages and childcare costs to pay with less income than you have now?
tone deaf.

Yes but housing benefit is based on local housing allowance which is based on council rent prices. Private renting is usually a few hundred more than max housing benefit and so that has to be paid out of state pension also. Just like with UC. So anyone private renting is well and truly stuffed in old age. Not to mention securing a private tenancy on such a low income would be impossible should your landlord decide to sell.
Home owners will always be better off than those is private rentals.

This! There's no point comparing yourself to other people.

Compare what you earn and spend now to what your pension would be in retirement.

The Donegans' website and YouTube course (Rebel Finance School) is worth studying too - if you won't have enough to be happy, then there are ways to address that.

That's exactly right, poorer pensioners are often single women. DH and I are older pensioners, we have an income around new SP levels, just under £2k a month. We have no mortgage or rent but pay full council tax. We don't get any means tested benefits.

We live well, still run a car, the house is warm. We haven't been abroad since lockdown, health reasons mainly. I'm in a hotel atm, short break with DGD. We still have some savings as a safety net. However, singly it would be a lot tougher.

Surely it very much depends on what lifestyle you have had previously. Big house with all associated costs, couple of cars, regular holidays, expensive meals out. Then £12k would feel very limiting in retirement. If you have lived on less your whole life maybe it seems “enough”

For the 2025/26 tax year, the full new State Pension is £230.25 per week, which equals £11,973 a year, requiring 35 qualifying years of National Insurance contributions. For those under the old system (basic State Pension), the full rate is £176.45 a week, requiring 30 qualifying years. Figures are expected to increase further for 2026/27.

You will then need to calculate for the following:

• Council Tax
• Gas & Electricity
• Water
• Broadband & Phone
• TV License
• Insurance: Home (buildings/contents), car, or life insurance.
• Transport: Fuel, public transport, or car payments, car maintenance
• Subscriptions: Streaming services (Netflix/Spotify), gym, or internet packages.
• Food/Groceries: Regular household food budget.
• Service Charges/Ground Rent: For leasehold properties/flats
• House maintenance
• Holidays
• Entertainment
• Clothes, shoes and personal items
• Birthdays and Christmas
• Hobbies

There probably others, but i think that would eat up one pension, easily per year.

Life is expensive, you need to be watching every penny.

It's not an attitude, it's a fact.

And you may pay NI all your working life but you're not 'paying into' your own pension, you're paying the pensions of the people who are already getting it.

The only ways to pay into a pension for yourself are to pay into your employer's scheme or a private pension (you can of course do both).

I haven't read the whole thread but my State Pension is £200 a week not £250. It wouldn't allow for unexpected expenses or luxuries.

This attitude is just not true. We pay tax and NI for the current pensions. You have to have full NI contributions to qualify for the max state pension, but this is where it ends.

There are many current pensioners that have/will have received 3 decades or more of state income. I don't think there is any way in which we can say that these people have 'worked all their lives'. It is not a criticism of pensioners at all, just the language and attitude needs to change.

It is not sustainable (as we can see front the ever increasing state pension age).

Some people have to. It's not necessarily a choice.

Yes I think it's perfectly do-able if you have no mortgage. A single person would get 25% off council tax if living alone and likely additional council tax support. I guess heating which you can't manage without as you get older is the biggest cost. I think the problem is that the state pension was meant to provide a basic income but today's generation of pensioners have largely always driven and had holidays and expect to be able to maintain that lifestyle which probably isn't realistic on slightly less than £1k a month.

No mortgage, two pensions and my job pension- we get about £1k per week net and save £2k per month. We are not wealthy but we are not broke either.

The big issue is replacing things that wear out and unforeseen costs. For me, enjoyment of life! A basic pension doesn’t provide for much. Bills are going up and most people cannot survive on just a state pension.

I would get pension credit, so that would help - I only get a small amount of my husband's pension.

I'm single and have my state pension plus a small occupational pension. I find it manageable, but if anything significant goes wrong, eg house repairs or a big car bill, I'd struggle.

I'm quite envious of my MIL, who gets pension credit as she has no state pension. Because she's on a means-tested benefit, she doesn't have to pay any council tax, but I have to pay all mine, which accounts for almost my private pension. And when anything goes wrong with her house, she just has to ring the council and they come and fix it, whereas I have to dip into my meagre savings.

I plan to move to a cheaper area to release some equity, and I realise that I'm lucky to have that option, but it does gall me slightly that MIL gets more from the state than I do (she gets full housing benefit for her rent as well as 100% off her council tax) when I've worked for over 50 years and she only ever worked for 10!

We downsized,to a 2 bedroom bungalow,10 minutes away from the sea,near the south downs. It's the edge of a village, but bus in the next road,if required later..basic state pension is £230. I have a small NHS pension, paid in for 15 years, then went PT as I got older,so it only counted as 12 years contributions.Couldn't afford to pay into it when dks were small and mortgage rates high. 16% in the 80s.. We've had one holiday in the past 17 years,last year in this country,dog friendly barn. They are our luxury item,if you like,farm bred border collies. We've had 3 dogs live to almost 18.cheap shop own tinned and kibble..vet plus £20 a month each dog,no insurance..My pension lump sum, paid for new double glazing,DH for 12 solar panels and 2 batteries on a scheme with our local authority.. used to go out for a meal monthly to a carvery, because we cannot eat the average restaurant meal. After 10 years, unfortunately it's been taken over,they don't do a carvery on week days,more expensive weekends, I can't cope with my hearing aids and the noise level and the food has gone right downhill and the service is awful. It's coffee and cake now, did that yesterday. We grow a lot of our own food and veg.. luckily DH is very handy, vehicle technician for over 40 years,does our car, and the kids cars.. the only DIY he hasn't done is the double glazing, driveway and new boiler.. We're in the SE, so council tax is pretty high. We are very careful,in the summer months we often make 20/30 kw of electricity a day, the export is banked with Octopus for the winter months, cooking is all electric I batch cook and freeze. In the summer months we used the emersion heater..we have future proofed the property as best we can.
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I think barring health issues and/or caring for those with health issues you can usually find a way to improve your situation.

DH and I worked our way from growing up with barely anything (in India) to making a good life for ourselves here. Studied hard at school, chose stem courses at uni. Went above and beyond to improve technical skills at work etc.

Moved here and just worked hard.

My state pension just about covers our household expenses, utility bills etc, not including food, running the car etc. With DH's pension and two decent occupational pensions added in, we have a comfortable life as two retired people in their 70's. I definitely could not live on my state pension alone.

Having said that, we run a modest car, have small UK based holidays and don't spend on expensive luxuries.

If your partner dies you lose his pension. Food bills would be around half, but not your other costs; you'd get lower council tax (but 3/4 not half), and other bills might remain similar to what you pay now.

You could go through what you spend currently and figure out what is essential, what is luxury, and what is not essential but you want to have it or you'd go mad.

This. I work in benefits for older people. I am genuinely shocked at how many of those just turning state pension age now do not have anywhere near a full state pension even , indicating that they have had huge gaps in their working lives. Obviously some will have been full time carers ot had disabilities themselves but there are also a lot who seem to have just not worked much ! My son's gf mum is one of them. She is early forties and has never worked, just lived off child maintenance and benefits.

Even if someone starts off at NMW at an entry level, once they get the hang of things don't they move up to shift leader or manager of some sort?

Even if you just plan on "surviving" rather than any other sorts of travel or entertainment expenses, you need to plan for repairs to your house. We recently had to replace our boiler and radiators at close to £10,000. Because we have teachers' pensions on top of State ones, we've been able to set aside money each month in anticipation of such expenses and so fixing the central heating wasn't such a blow to us. But if we had no ability to save, then it would have been disastrous.

@cateringdayi certainly wouldn’t be comfortable living on just the state pension. It’s designed to cover the basics, but if you want a decent quality of life, it makes sense to make your own personal provision as well. At that point in your life after retiring from work, the one thing you’ve got oodles of is time. I won’t want to spend my days worrying about whether I can afford a holiday or dinner out or concert tickets….

There’s a reason auto-enrolment in workplace pensions was brought in. The govt could not be stronger in encouraging people to make contributions to a workplace (or private) pension alongside their NI contributions for state pension.

so, while it may be doable to live solely off a state pension, it’s not something I would want which is why I’ve worked full time my whole adult life (bar 3 years of part time when my babies were tiny) and paid a hell of a lot each month into my pension.