Do you more or less since retirement?

[Hopthegoodgod]

I am trying to organise my pensions and was wondering if people generally found they spend more or less once retired from full time employment. I have crunched the figures and know what I can expec to recieve in the way of private and state pension but it is not quite as much as I earn on my full time salary. It would mean a 5% drop. Have people found they are spending more because they have time on their hands? The only thing I may save on is cheaper holidays as will not longer have to take them in school holidays. Let me know .

I've never heard of anyone spending more, only less.

Most people aren't buying coffee's, lunches, keeping up appearances in the office, prescriptions, commuting and mortgages.

@Hopthegoodgod sorry if this is an obvious question but is the 5% net or gross? Pensions do not have NI & pension contributions deducted so net is a better comparison. Use a gross to net pay calculator.

Personally I spend less on public transport (commute) but more on petrol. Food is less because I don’t buy lunch etc. Holidays is more because I can go away for longer and more often. I pay slightly more on heating during the winter. I do a lot of low cost activities so this is where you can spend a lot more.

Is the mortgage paid? I think that’s the main reason people spend less.

Less

No petrol costs going to work every day

No car park charges

No registration fees for professional register or Union

Etc

Not me but my parents. Varied over the years. They spent lots on travelling worldwide in the early years plus lots of socialising. But lots of cheap entry to places etc. Continued to run two cars. But after the first 5 years or so they wound down the travelling gradually over the next 10 years or so, they are mid 80s now and no holidays at all for the last few years, in the last couple of years it was just UK coach holidays. Down to one small car after about 10 years, gradually less socialising as their friends died or became infirm. But care costs gradually increased, podiatrist, gardener, one will need residential care soon so expenses through the roof then. So it doesn't stay the same.

I thought they do attract ni & tax? Your pension contributions are taken at source so tax hasn’t already been paid on that

It depends on what you are spending on now but I would say that if you want to retire now then a 5% drop is unlikely to make a difference in the long term.

Traditionally people spend more when they first retire - longer holidays, investing in the house/car for the long term, more socialising. And they may need to pay off their mortgage. Then there is quite a cheap phase when you can't do that stuff any more but before you need any paid-for care. Final phase is expensive if you are paying for care, although a surprising proportion (maybe half) of us die without needing care at all.

I have heard it said that there are three phases of retirement - saga; aga; & gaga. In the first, you will be enjoying your freedom as well as, hopefully, good health & a good social life (as your friends are also retired & healthy). You’ll spend quite a lot then. The “aga” phase is when you are at home by your aga. You’re not as fit & active as you were and enjoy your home comforts but don’t need care. That can be a cheaper phase as it’s the running costs of your home and your life at home. Then there’s the stage when you need some sort of care, either at home or in a home.
It can also depend on how on top of things you are at the moment or whether you have been putting off doing things until you stop working. The wife of neighbour retired last September and since then they’ve had the garden landscaped, the bathroom replaced and are now about to do the kitchen so it’s all done by the time the husband retires at Christmas. It’s been a massive dent in their savings but they never had time to organise it all beforehand.

You pay tax on pensions but not NI or pension contributions.

Yes. No debts or loans.

Less, mostly because of not commuting.

I have paid for new bathrooms, roof, curtains carpets, sofas etc in last couple years as I wanted these done before retirement. I know these big ticket items would need doing before I became a pensioner. However I do plan to travel more extensively ( son in Australia) and take up a hobby ( been time poor in past). I just don't want to be sitting around worrying about finances and not having enough to enjoy life.

I have more income in retirement than when I was working (went early at 57) and are probably spending more (no debts or mortgage).
For many years when working I had been making over payments into the company pension and participating in share ownership schemes thereby reducing my accessable pay (and therefore tax & NI).
Meant that for years I had been living on a salary artificially lower than it might have been, still left me with a comfortable income but I knew it was the best strategy for me.

We have spent far more in this our first joint year of retirement but we bought a Motorhome and plan a trip round Asia next year. Finding out what your trips will cost approximately is easy enough.

Our income will always fluctuate due to investments. Our pensions are defined benefits so we have a specific budget and anything else is a bonus. After the big wobble when Trump was elected our investments have out performed what was expected.

You have more time to shop around as well.

I definitely spend more , I am socialising much more , going to classes , travelling etc etc .

More - initially because you do more then as your health fails you have to pay people to do things you previously did yourself. Also health care has deteriorated so you may have to pay unless you want to wait forever. You may find you are paying more for eye care/ dental care too.

Of course if you have always paid people to do every bit of decorating/ gardening cleaning this may not apply to you.