Anyone else thinking they’re going to be a bit fucked in retirement?

[GinghamSkirt]

I’ve seen a few threads lately where posters are discussing how much pension they’ll have, and while I’m happy for those people I’m also quietly despairing at myself for sleepwalking into a rubbish retirement.

All my fault, not blaming anyone else - series of poor life decisions and lack of forward vision and planning. Not looking for sympathy! Just trying to figure out how it’s going to work.

I’ll have the basic pension plus a few thousand per year (income will be well under 20k.

I know lots of people live on that quite happily, but I’m living on more than that that at the moment and working full time, don’t have any spare to save or invest, house (mortgaged) is crumbling around me and I don’t have enough to go on holiday as I’m clearing debts.

Not that I’m entitled to holidays of course - but I see other people on a similar income having a couple of lovely holidays per year and am just kicking myself for being so bad at money management.

The cost of living is biting very hard NOW - what’s it going to be like when my income is so much lower? I do try very hard to budget and spend money in the right way - always looking for a cheaper option, cancel unnecessary subscriptions etc, bring my lunch to work, buy clothes (and sell them) on Vinted etc.

it would be nice to hear from people in the same position (retiring in under 10 years if indeed that does happen) who have also fucked up and are contemplating a very different retirement compared to many on here! I don’t have a partner so all household bills are mine alone, no shared income pot.

I am very lucky in the sense that I own my house although it is heavily mortgaged still, but in order to pay the mortgage off I’ll have to sell it and buy somewhere else. If I want to live somewhere that’s not a total dump there won’t be anything left to invest. So it’s great that I’ll be able to live mortgage free eventually and I know that a lot of people don’t have that luxury, but I can’t really look on that as an income source either.

i couldn’t judge myself any harder than I currently am, definitely feel as though I missed an important memo somewhere in life, wasn’t working while my kids were young and then bingo - divorce 🤣

I worked full time since but have not earned enough and there were too many years to make up for. I genuinely didn’t understand how hard I should have been focusing on my retirement at that point.
NI payments are all good though 👍

There are a few mitigating factors eg supporting family members, mental health issues etc but essentially I’ve been naive and foolish - as the future comes closer to being reality and the stark facts become clear, now finally I get it.

Anyway, at the very least this thread might make you feel better about your own situation - if not, I’ll commiserate with you 😊

How old are you? things can change.

Similar here but with no mortgage thankfully, so I know I’m in a slightly stronger position. I’m retiring (or meant to be) in 5 years but already thinking of schemes to supplement my income.

It's hasn't been mentioned yet, everyone on this thread come do Rebel Finance School! Honestly it'd brilliant, it's totally free, no selling, just run by a lovely couple who managed to retire early and they recently got awarded an OBE for services in financial education. Since doing it I've made massive headway towards having a better retirement and it doesn't matter if you are 10 or 20 or 30 years from retirement 😊. It's a comprehensive 9 week course going through everything from mindset to having a gap in income and expenditure and understanding your pension and maximising what it's invested in. I went from not understanding anything about pensions and investments to being on a much better track.

I’ll be state pension and some work pensions. But the number of people who opt of paying pension through work is mind boggling.
its piss take to pay X amount each month but think long term.

https://rebeldonegans.com/finance/rfs/

Edited - I can see some of you beat me to it!

A MNetter recommended this: https://rebeldonegans.com/finance/rfs/course-notes/ - and I joined the course.
I can't recommend it highly enough.

Start at video 1 and work through, doing all the exercises. You have time to improve things a lot OP.

OP if it makes you feel any better, I thought I was careful in my younger years and diligently put money away etc but recently when me and dh finally took a look at what our pension would look like, it was very sobering.

Totally understand.
I can't ever retire.
MMim not a home owner, years of caring for my dc and then parents mean I've rarely worked full time.

I thankfully don't need physical strength/ability to keep working.

I think divesting myself of the costs associated with my young adult children will be interesting.
When I add it all up it’s pretty enormous with 4 kids.
Spotify
Phones
Netflix
Amazon prime
Amazon film subscription
Health insurance
Taxes on the small bits of money they earn (we live in a country with a household taxable income so everyone who lives there is in one basket).

And moving somewhere with 1 bed where you’re close enough to walk to amenities is probably what we should all be looking at doing. I doubt I’ll ever persuade my DH though. But if he goes first that is what I will do.
Currently I’m divesting ourselves of all surplus shit we don’t need. One drawer at a time. I just keep saying I don’t want the kids to have to do it which he can get behind. I’m 54 he’s 56. We have one teen left at home. 1 who comes home in the holidays.

@Sunshineandrainbow if you have some NHS pension join a Facebook group called NHS Pension Chat - Member Led Discussion Group. It was bewildering for a long time but as I’ve read more threads I’ve understood more. You can also get a pension forecast at the NHSBA website - if you google ‘NHS pension forecast you will eventually find it buried under all the adverts for highly suspect financial advice.

The key thing I’ve learned from the FB group is that if you have any pension in the 1995 scheme then claim it from age 60 whether you’re working or not - it doesn’t grow or accumulate after that. If you have 2015 pension scheme funds then probably delay taking it as much as you can.

Hey OP, well done on identifying the problem now, and on starting the process of educating yourself about what to do to fix it. The old saying - best time to plant a tree was yesterday, second best time is today.

Knowledge and a plan are the key to not worrying about this. You don’t say how old you are, so it’s hard to give specific advice, but you should make sure you are financially literate - either with Dave Ramsey, or Martin Lewis or Rebel Finace course, or whatever you see fit. But actually do it. Then work on the key steps to consolidate your position now - pay off consumer debt, have a 3-6 month emergency fund and budget/live within your means.

Then move to retirement consolidation. A paid-for house - the more you pay off this one now, the more equity you have for the next purchase AND the less insterest you pay now. They say people naturally spend 70-80% of the pre-retirement income in retirement, as there is no need for several costs associated with working (work clothes, petrol/transport costs to work etc). Work out what your retirement income will be (as it sounds like, you already have this figure) and then try to live off 20% more than that, not including mortgage. This should give you a realistic ideal of your lifestyle in retirement, and any extra you save by doing this could go into your pension, hopefully beefing it up abit. Look too, at what working one or two more years (either full or part time) might do for your pension or income in retirement - this can often make a big difference in your monthly amount, as every £10/m may seem small, but can be stretched further and you’ll be glad for them.

Sleepwalk no more! Educate, make a plan and make it happen!

No. I'm a city dweller by soul, but currently inhabiting a rural flat. I can survive on a British pension. I can enjoy a flat. Have another 20 years working so live and work. Take it mentally easy but work physically hard is my motto in life

A sandy dune and coffee is all I need, anyway. Enjoy life my darling

Yep.

I have had various work pensions since leaving university but they arent amazing and I messed up with one by missing the date to transfer it to a better scheme. I cant pay extra into my current one.

State pension wont be about by the time I retire.

I dont have the cash to get a top up private pension.

On the plus side, our house should be paid off albeit there wont be much equity in it and with global warming, we'll possibly need to move further inland anyway.

HMOs for the elderly what a depressing thought.

Also have a look for a website called Retirement Living Standards, sorry, I am rubbish at links, as it gives actual numbers of how much you need for a frugal, comfortable and luxurious retirement.
you need to know your number, which is the amount you spend on bills, food, housing and essentials. You can then work out what wants you have and can start saving.

you have time to make a big difference, and every thread like this might give a young woman a nudge to NOT be a sahm, or to make sure her pension is included in the costs of staying at home

@IDontHateRainbows me and my besties are already planning on living together, when we are old, and spending the last of the money on gin and fizz and smoked salmon every day. It will be brilliant fun.

It’s tough isn’t it. I have no idea what my retirement will look like. I’m 54, battling 2 cancers. Currently off sick from my low earning job. DP is older and has a health condition too. Right now, we manage. Home is owned and finances are managed accordingly . We also have 2 young adult DC ( one working and the other at Uni) Both have a decent deposit for a small property, thanks to an inheritance many years ago.

We just have to do what we can to make things work. No one can predict the future.

This sounds like a fab idea!!

I’m open to eventually getting a lodger - probably a stranger - which won’t be ideal, but needs must and all that. I’d prefer to meet and marry a solvent and comfortably off man, but I think that’s unlikely. It’s the burden of paying for everything myself - if I can - on a small income that also concerns me.

For anyone owning their own home, equity-release mortgages are worth considering as a backup.

When I looked into them two or three years ago as a rough rule of thumb you could take a cash lump sum of one third of the value of your home in your mid sixties on the basis that you continue to live there for free until you die or move into a care home, at which point the place is sold and all the money goes to the financial institution.

Do you own research, there have been scams and scandals in that sector, but worth considering.

Gosh so many replies, thanks everyone for adding to the thread, I really appreciate the advice and the solidarity. I’ll respond to questions etc - bear with me!
Will definitely be looking at that link this afternoon 😊

@CreepyDaveits very reassuring to be able to downsize and release funds, glad you have that option.
@menopausalmare I like that idea 🤣 Makes total sense financially. I think I’m too antisocial for that though - as I get older I like my own company (ok and my kids) best.

@DiordreBarlow Thank you for such a nice reply, you’re very kind. And totally right to build a future plan based on what I’ll have, not what I wish I had. It’s a good point about having more time to look for bargains too 🤣

Honestly we’re okay but secretly I’m banking on one of the kids being really successful and keeping us in our old age. DD currently wants to be a teacher so it will probably be DS who wants to be prime minister (after we explained he cannot be king). DD2 hasn’t been born yet but I’ve been watching a lot of House MD so maybe she will want to be a mean sarcastic doctor.