Cost of everything (retirement)

[H202too]

https://www.mirror.co.uk/money/we-saved-350000-retirement-monthly-37498822?utmmedium=Social&utmcampaign=main&utmsource=Facebook&fbclid=IwdGRleATZ4vBwZG9mBWV4dG4DYWVtAjExAHNydGMGYXBwX2lkCjY2Mjg1NjgzNzkAAR6rBUMA2lMbYk-rATEy6IndXG9KSDbl7szlanfzYTF5DGfvyIElMpJK08M1waem1AFpPsa5PMCSkIjLIWlSZw#Echobox=1785492928

I have mixed feelings about this. On one hand everything is ridiculously expensive on the other I think £1700 with no housing costs is a lot.
They are also savvy to have planned but also the cost of everything is crazy! It is harder than it has been in my lifetime,ok not 1872 hard but harder than 1992. But also 10k for two weeks in Italy. 🤔
What do you think?
I have mixed opinions.

The younger you are when you start a workplace pension the better. The cost will be pretty low at first, then increase as your salary increases. Waiting until you’re in your 40s, as this couple did, means it will cost you a lot more and you’ll end up with a lot less.
DH and I are both retired and currently our income is around £2k a month. We manage to live relatively well (although we’re not big spenders) and have a couple of decent holidays a year paid out of savings. Once DH receives his state pension we will be able to save each month - currently savings have been put on hold. All of this was planned well in advance of our retirements.

I can only assume they have very little life experience and no education. They are ridiculous and an insult to those in real poverty.

The thing is, at 63 and 61 they ARE working age these days. They want a luxury retirement several years before state pension age.

I understand why they want that but the maths just doesn't work, for their situation (especially if they want high end holidays) and on a national level.

There is, and I think will continue to be, a growing movement towards a longer and more flexible partial retirement options.

They just didn’t do their sums properly and also have an over optimistic perspective on what they can afford. £10k for two weeks in Italy is a crazy amount to spend with their finances. They have options - increasing rent, sell a property, change the expensive car - they need to cut their cloth more accurately!!

I understand how pensions work but young people have stagnant wages, high education costs, housing costs & frozen tax bands which means putting that extra into a pension becomes difficult because you don’t have extra in the first place….

What a ridiculous article. No way should 2 weeks in Italy be costing them 10k. They’ve obviously gone for a luxury option, which is fine if you can afford it but they can’t.

I won’t have a lot in retirement but I’ll have enough for what I want/need. I’m 57 this year so I’ve been planning. Yes the COL is horrendous but that is true for everyone, not just retirees. Nothing to stop either of them getting at least a part time job. My uncle who is 76 and has had cancer twice since his 60s has gone back to work part time. Not even because he needs the money but because he loves his work. My career has plenty of part time openings for retirees, most of my team are retired! So I know that’s an option for me. It’s not full time work or nothing.

I didn't save into a pension (stupidly) until I was nearly 40. I think it's going to give me £7k a year. I have £200k equity in a buy to let house and I'll get state pension. I have started to really worry about my retirement which will be when I literally can't do my job any more (self employed) I honestly don't know if it will be enough

I think it's a tough balance because I want to spend and have fun and £10k holidays. But at the same time don't want to end up in a council care home stinking of piss.

If you stop working early you can't really blame the cost of living. They took early retirement that wouldn't fund the lifestyle they wanted! They only retired last year - the cost of living hasn't gone up that much since. Madness.

Yeah my bil and sil did this, retired at 50, pensions were 50k between them, had about 500k in savings, lived very frugally their whole married lives to save it. We all thought they were solid, mortgage free, lived frugally, it would be fine, but couldn’t understand the retiring at that age bit, for him if not her.

7 years later they have blown the lot apart from 50k , all on needless house stuff, holidays, cars, socialising, as they had fuck all else to do.

Now they are worried about money, not to live, but to enjoy themselves, they don’t want to work, and are really fucking bitter and envious when anyone else is doing something fun, we booked a hol, commented we were going on hols and got met with it’s alright for some comments. Same as we went to a gig, something they’d normally jump at, we got “how much!”, “we can’t spend that. “It was a hundred odd a ticket, we were all suggesting doing something in London. She suggested we stay at a fucking hostel. Nothing wrong with hostels, but I’m not doing that, neither were the others, we can afford a hotel. So we ended up all not going. We all went to a local community thing, was a 20 min drive away, she wanted us to get the bus. I had to explain a taxi with 4 in it was just as cheap and even offered to pay it. Nothing wrong with the bus, but it’s a ridiculous way to save money when you’re splurging the rest of the time, it was performative and no more.

the bitterness is shocking, we are all still working, they’ve been sitting on their arse for 7 years spending like the world was ending. They keep going on about having no money left. They literally spent their savings every week to fund their daddy warbuck lifestyles. Didn’t even attempt to live off their pensions.

Now they can’t keep doing it and are pissed off.but if you suggest getting a job they look at you like you’ve grown an extra head and suggested they invite their neighbours round to watch them take a shit in the drive.

the remaining 50 k will be gone soon enough, they are already talking about doing more unneeded house shit. It’s just bizzare, it’s like they worked all their lives, saved, lived frugally and now all they can to to entertain themselves is spend spend spend.
.

To be honest they seem a bit dim. If you are going to budget £10k for holidays then don’t spend it all on one two week trip. Similarly did they not think about what need to be replaced in their home, check the costs and then look at whether early retirement was feasible?
Dh retired ar 53, but we checked whether this would be affordable for us before we ran out of money and resorted to a sad face article in the daily mail

I think £1700 outgoings is a lot without a mortgage cost. I think mine are similar with a mortgage.

Also brings the debate about retirement age. Also young people are struggling for jobs but retired people need a job as well. That's animal multi faceted debate.

£10k on one trip to Italy? When they had a holiday fund of that amount for two years?

DH and I regularly go to Italy for the same length of time and have never spent so much. What were they doing there?!

They should have done their sums if they wanted to travel the world and to both retire early.

DH and I are mid 60s. I'm retiring in October, DH partially at Christmas. Our fixed outgoings are far higher than that but we will be able to fund them and live well. They are also elective and if that were not the case, we could reduce them. Our pension pot has recently grown exponentially because it was an IHT management initiative. DH now accepts we must spend it.

More seriously, I rang DWP last year to see if I was entitled to my full pension for planning purposes due to spending a decade or so contracted out. They confirmed I was entitled to the full state pension and also said I was the only person they had shared news with for a few weeks who had had positive news to receive.

I went p/t last year and with my state and occupational pension, I'll be about £650pcm better off because I won't be paying pension contribitions or NI.

You can see this on the HMRC /gov app also, it tells you how many years have left to pay in for anyone interested.

You can but there is a lot of evidence indicsting those quotes aren't accurate and don't account for the contracted out periods due to errors with the IT build.

Agree, they have both decided to retire early whilst going g on 10k holidays.
It’s better to keep working , even part time. I intend to this this to within a few months of getting my state pension

I find it odd the way so many people seem to defer all their travelling/holidays for retirement. We have always had nice holidays when our child was growing up and also later on whilst still working.

Now I find I don't want the hassle of flying and am very happy we have been everywhere we wanted to go - mainly around Europe, to be fair, not long haul.

Therefore £10k for holidays is a large chunk of retirement income. We retired a bit early, my husband in his late 50's and me early 60's. I think we manage comfortably on our pension income both government ones and our occupational ones, and supplement it occasionally with savings - for example we bought a new car for cash recently from our savings.

We treat the grandchildren for days out, enjoy a bit of spending on our hobbies, mine being my garden. We exist very happily and comfortably on £45k p.a. between us. (We have separate finances - we got together in middle age, so that works for us!). We jointly contribute towards household bills and food costs.

Financial planning occurred inasmuch that I have gifted a couple of large sums to the younger generation for house deposit etc. so hopefully these will not be subject to inheritance tax, as fingers crossed I will live for the requisite seven years, indeed seven years has already elapsed after the first gift.

You do have to plan your finances, know what you are likely to receive pension wise, invest in a savvy way to minimise tax i.e. ISA's and once retired not spend madly - personally I think the couple quoted have been unrealistic in their expectations. I also don't understand their outgoings of £1700 per month if you're mortgage free. Everyone's priorities are different I guess, but we find we can live within our income.

I don’t think many do save hols for retirement. We have travelled all over, our daughter has seen much of the world on our hols and when we retire, we will up the travel, I can’t imagine a retirement where I say I’ve seen it all so will stay home now.

Good to be aware of. Luckily mine seems to fit what I thought.

I totally understand your point - and it's great if you want to continue with your exploring and travelling. My last foreign holiday was to celebrate my 70th and was a lovely five star hotel in Porto - a real treat, much appreciated and very much enjoyed! I also had never visited Portugal before, so it was somewhere new.

For me however flying doesn't appeal as I've got older - but of course each to their own, there's no right or wrong way to enjoy your retirement - whatever we do, we've all earned our downtime and relaxation. As the saying goes 'there are no pockets in a shroud'!

Yeah 100% agree. We have a ticking time bomb in this country. Years ago people got a mortgage young and had lovely final salary pensions. Even if they didn't have a final salary pension mortgages would usually be 20 to 25 years and then there was time to save for retirement. As things stand now we will have a lot of people with no retirement savings still paying rent in retirement and this will be through no fault of their own.

This is ridiculous. Me and DH have are having a lovely retirement on 30K a year between us. That's his 2 work pensions, my work pension, and his state pension. We've also got money in the bank for emergencies and what I would consider a pretty good financial cushion.

We didn't save frantically, once the mortgage was paid off, we just saved up the mortgage money in a reasonably high interest account. We didn't 'invest' as such. We then downsized, and that money also went into retirement savings.

Admittedly we have a much more frugal lifestyle than this couple, but that was the choice we made when I gave up work early. I'd rather have more time with DH than a more lavish, but shorter, retirement, having worked myself into the ground.

Thinking you can spend 10K on one holiday, then moaning because you can't pay your bills is an insult to those who are genuinely struggling. Loads of families with children have far less than this couple, and many pensioners are managing on just the state pension.

I've seen this post on another forum; think the article appeared in the Manchester Evening News, it's just click bait.

There is a discussion to be had around adequate pension provision, but this isn't it.

I've no idea how you would be able to spend £10,000 on a fortnight in Italy- ridiculous.

@Rumpledandcrumpled that is mad! Why on earth did they retire at 50, that is extraordinarily young.

The only person I know who "retired" at 50 was a policeman who had been in the force since 18 so had done his 30 years. But he still works, just not as a frontline police officer, which is fair given the stress and physical wesr and tear of the job.