What monthly income do couples need for a comfortable retirement?

[sha777]

Hi.
I'm just trying to work out what we need money-wise in retirement.
Can anyone give us a real-life experience of what they live on.
Our requirements are quite simple we have no debt or mortgage.
Couple of holidays abroad per year and like to eat out once a week .
Were hoping £2500 a month will give us that.

I would like about 40k per year (or equivalent in today’s money) including state pension. I earn about 60k and am already mortgage free but am saving/ investing around 1k a month into shares and pensions. I’m also saving for teen dd. So those costs would be gone. I wouldn’t be paying for dd which prob costs me about 750-1k a month (that includes holidays/ presents/ concerts and normal kid stuff). I would then want to maintain my current lifestyle though if I’m older I might be more tired and not want to do all the things I currently do.

Talk to people who have actually retired. Most say they spend less than they thought. You have time to hunt out bargains, compare insurance prices, take advantage of pensioner deals, travel at cheaper times, cut down to one car etc. You also just need to cut your cloth according to what you have.

There are many people who earn and raise families on some of the figures quoted.

Roof? Driveway? Hall redecorating? Bathroom, kitchen? Car. They don't last forever.

I haven’t got a car or a driveway, or a garden. My flat is leasehold so I’m not responsible for the roof. I don’t have a hall but I do have a small landing area that the rooms go off. My bathroom is relatively new and will last a good few years. The kitchen may need an upgrade but it’s not a sudden emergency expense and neither is redecorating.

I think this illustrates how everyone’s needs are so different and it’s incredibly difficult to give a ballpark figure about how much you might need in retirement.

These figures are really surprising.

We easily manage on less than 3k a month and we do not skimp at all. We have no mortgage but I wouldn’t expect most retired people to have one either.

We go out regularly, go abroad a couple of times a year plus trips in the UK and we often have money left over. What are people spending money on?

Expenditure needs a realistic review and honest amounts considered
House - repairs redecoration and just those things that happen storm damage to roof
boiler stopping working
Are you planning to sell & downsize?
Rent out a room?
Medical expenses ? Would you want to go private for your hip or cataracts ?
Dentistry if private
Gas/ oil/ electric
Household and car insurance creeping ever upward
Council tax
Car service tyres maintenance and your insurance rises as you get older .
Clothing maybe you are frugal but you’ll still need new pants shoes and waterproof coat now and again .
Haircuts
Petrol / diesel
Any pets ? Insurance vet bills and feeding
Groceries ever increasing
Enjoy gardening ? Can be a frugal hobby but can also be very expensive .
Someone to help in garden if it’s large and gets overwhelming?
Replacing things like washing machine even a new kettle is around £50 these days
£3000 sound ok to me my sister is so frugal and lives well on around £1500 a month I couldn’t possibly but we are all different .
The key is budget and being honest and accurate .
I spend £100 a month on my hair my husband spends £200 on fishing .. both still working and high earners not an issue but would be expecting to reduce costs if retiring .
Good luck and happy retirement

It all depends doesn't it? Eg is your holiday a Tui package to Lanzarote or is it a 21 day package to South America? Do you use Boots No 7 products or Dior? Do you shop at Aldi or Waitrose? Do you buy clothes in supermarkets or from upmarket brands? Do you run a small car or a large SUV? People are not going to change their habits when retired unless they have to. People who have had good incomes will tend to have a good pension set up and continue to live their life as they had before.

Forgot to add and prompted by someone else - 30 a month for a dental plan although I still had to pay 2000 for a root canal and crown. Cosmetic beauty treatments averages 150 a month. Contact lenses 50 a month. There's another 230.

Guess none of those are essential and a lot of pensioners wouldn't be able to afford those things. I'm having a tooth pulled next month rather than a root canal. I need 2 doing and can only afford one. If I couldn't afford either I'd just have to have both pulled out. I've never had a cosmetic beauty treatment in my life. My contacts are £25 a month but I'd make do with glasses only if necessary.

Have you worked out your minimum expenses? That would not be enough for me, e.g. even without mortgage our bills are over 1k, food usually around the same

I had a look at the website linked on the first page of the thread, and it was interesting - and so was the research report.

The calculations are based on urban areas (London and Not-London). We live rurally so would be looking at different costs - it's quite restrictive for a couple to share a car, for example, so most end up with two (public transport is a bit of a joke out here), and we rely on heating oil which has gone up a lot since things kicked off with Iran.

Does a partners private pension die with them? Isn’t it transferable even just part? Seems harsh you can pay into a pension all those years, only have it for a few years, die and then nobody gets the benefit.

You get about half.

That's quite high. Ours are about 1k for both but we pay some things annually like CT, season tickets/fees, car tax/insurance with the interest from our savings.

OP we get £3k after tax for two private pensions.

Obviously it will be around 5k when we get our state pensions.

But we do have the buffer of savings. Some of which we put into a higher interest account that we can't touch for a year and the rest into a credit union which we get dividends from quarterly.

£2.5k is doable imo.

Depends what pension you are referring to.

State pension - dies with you
DC pension pot - what's left is passed on according to your will
DB pension - a survivors pension may be paid in accordance with the scheme terms, often will be a 50% widows / widowers pension for the remainder of their life but it depends.

Ok OP, if you are still around here's our situation.
DH and I have defined contribution pensions and together with DH's state pension this amounts to £3300 per month.
Owned outright house.
No debt.
One shared car.
One two week 4* med holiday per year, one 3 week holiday in Cornwall or Devon per year (rental cottage).
Weekend break every month, (I use Travelzoo or Secret Escapes for bargains).
Gym memberships £70 for both of us.
National Trust, RSPB and English heritage memberships.
Small boat with £80 a month mooring fee.
Spend around £150 a week on food as have one adult DC living with us, we do not charge them for living here as they are saving for own place and don't take the piss.
We are sometimes saving about £600 at the end of the month and our living standards do not seem to have dropped from when we were working. At least we don't have to buy school uniforms etc now.
Made recent decision not to get another dog (ours passed away after an expensive illness) as we are not sure we can easily afford another round of vet fees without going into savings.
Also decided not to pay insane fees to join our local golf club.
I think you just cut your cloth to fit don't you?
We are careful but we think we have a nice lifestyle.
What we lack in lots of fine dining we make up for in being out and about in nature, art galleries and day time music recitals.

As I said in another post if you have had these things in life then you will tend to continue them. What is essential to someone will be a luxury to others and vice versa. Your life on your pension will tend to be very similar to your working life.

If you can withdraw and put into a private investment fund then it will not die with you depending on how much you spend obviously.

If leasehold then you must pay service charges and ground rent? These are things that can escalate. My service fees in my flat ten years ago were 200 a month.

I spend more on holidays - three weeks in South America with business class flights. No mortgage, annual income around £100k.

From pensions?

It’s leasehold from the local authority. Ex council flat. Ground rent is £10 per year. Service charge is estimated at £300 per year and for the last five years has been between £250 and £280.

too young for state pensions and Dh claims just one of his so far. Remainder is from investments.

I spend £2500 per month. Don’t fly so holiday in England. Eat out once or twice each week, It’s enough, Dip into savings occasionally for unexpected costs.

I'd have to concede that so far, at 70, our life hasn't changed yet because DH is still at work. As am I, plus we have state pensions. But we are also paying £1000 per month to cover our DC's rent in Farnham on a house share, because an apprentice's earnings do not cover the basics.