How much money do you think would be enough to retire on in the future?

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crllufc@reddit

Luckily I’m part of a DB pension so having to save isn’t so much of an issue for me. Currently aiming to retire at 57, this will obviously reduce my annual spend but life is too short. I’ll be mortgage free by then and outgoings should be a lot a lower.

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BaldyBaldyBouncer@reddit

If you own your own home outright you could live comfortably now with an income of 25-30k. Most people downsize when they retire to boost their liquid wealth too. If you're renting now, you ain't ever retiring.

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Lazy_Age_9466@reddit

I will be living on less than this when I retire. Most people I know live on less than this on retirement.

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Mobile-Stomach719@reddit

Agreed on downsizing. A bungalow on the estate behind me will generally sell for more than my house is worth even though I have more space.

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Lazy_Age_9466@reddit

The only way I could free up money by downsizing would be to move to a terraced house. And that would be insane to buy a house with steep stairs as you are getting older.

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Mobile-Stomach719@reddit

Agreed, pointless.

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heliskinki@reddit

Bungalows have a bigger footprint and occupy more land, plus they’re In higher demand than your average house so they’re always going to seem expensive.

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BaldyBaldyBouncer@reddit

I said comfortably, most of us will be far from comfortable. The benefit of downsizing obviously depends on how much less the home you are moving to costs. If that figure is multiple hundreds of thousands it's definitely worth it. Alternatively you can release equity in your house which is what homeowners will be forced to do meaning they will likely be the last generation who owns property in this country.

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Lazy_Age_9466@reddit

Most of us are not comfortably off i.e. rich anytime in our lives. You can retire once you can pay your daily living expenses plus a bit of money for fun. But that is way less than people on reddit generally say.

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jeremyascot@reddit

But the annual income needed for a minimum retirement living standard was £13,400 a year for one person and £21,600 for two, the Pensions and Lifetime Savings Association estimates . For what it calls a "moderate" lifestyle, a single person would need £31,700 a year, while two people require £43,900. For a "comfortable" retirement, it's an annual income of £43,900 for one, and £60,600 for two. Why I'm not paying into a pension https://www.bbc.com/news/articles/c05631v11ndo

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Exact_Setting9562@reddit

I'd take those numbers with a pinch of salt personally. As it's in their interest to make people put as much as possible into their pension.

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Basic-Pudding-3627@reddit

Why is it in their interest, and not yours??

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Exact_Setting9562@reddit

That's how they make their money - it's their business. The more money they get in the more money they make. Sure a pension is always a good thing but there's other things to do with your money too. Some people don't live long enough to get there sadly.

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Basic-Pudding-3627@reddit

What are you talking about, that is how a business in the capitalist world works!! How else are they supposed to make money, or do you think they should be a charity? For most people, the compounding of their gross income and the tax incentives are why you should have a pension.

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Exact_Setting9562@reddit

I've been on many pension courses with work. Run by advisers who can't sell us any products so very independent. The calculations we'd make always seemed to be a lot lower than the bigger numbers you see talked about. Plus a few years of drawing a pension seems to back up my findings.

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PervertedTroller@reddit

A diverse income is important too. If all you have is a private pension and your state pension you're not going to have a great retirement. If you've just got the state pension coming your way you're pretty fucked.

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fionakitty21@reddit

Yeah, im fucked.

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MaterialFollowing4@reddit

> If all you have is a private pension and your state pension you're not going to have a great retirement. Why? If you have £2m in your private pension you'll have a very comfortable retirement.

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Matthew94@reddit

> Why I'm not paying into a pension Given the tax advantages and compounding growth, people who don't pay into a pension are just irresponsible. >He worked in retail during university and was auto-enrolled in a pension scheme -but when he realised he couldn't use the money until he retired, he stopped it. You reap what you sow.

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Lazy_Age_9466@reddit

I already spend about £1k a month on living expenses, plus another £4k on holidays and repairs and maintenance. If you have expensive habits, you need more money. I am working, but on time off I go walking, gardening, go round friends houses, etc. Its all cheap. I cook all my meals from scratch which is cheaper. Own our car outright. People spend a lot of money on nothing much.

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Flat_Development6659@reddit

>I already spend about £1k a month on living expenses, plus another £4k on holidays and repairs and maintenance You spend 4 grand a month on holidays and repairs?

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Lazy_Age_9466@reddit

£4k a year on holidays and maintenance.

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DoctorWhofan789eywim@reddit

Ii think by the time I retire there will be some kind of Universal Basic Income, we're getting dangerously close to it being needed now, never mind forty years time.

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MaterialFollowing4@reddit

If this happens there is no chance it'll be on top of the state pension. UBI only works if it replaces the current welfare system.

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DoctorWhofan789eywim@reddit

Oh for sure, I am going by the assumption the state pension wont exist by the time I retire, especially if cost of living keeps rising at the current rate.

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MisterD90x@reddit

Hahahaha retire lmao Probably way more than I'll ever see

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Basic-Pudding-3627@reddit

I'll put a number on it. £2m is the new £1m lol. Some analyst worked out a safe drawdown is around 4%, now 4.7% I read somewhere - to be able to still have money for however long you may live. 4% of 1m is £40k a year gross. The tax will depend on if you have a pension, ISA's and/or GIA to draw from - or all 3. Inflation and cost of living in 20-30 years will require a higher fund.

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Mobile-Stomach719@reddit

I love these safe drawdown %ages. Drawdown as a concept, certainly in the UK, hasn’t been around long enough to deserve the absolute certainty that some folk apply to it.

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quarky_uk@reddit

It also is for countries which don't have a state pension. Things like a state pension change those numbers significantly.

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DildoIsWayToBig@reddit

Hahahah that's a funny joke

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MaterialFollowing4@reddit

I'm aiming for a £40k annual income in retirement and will need £1m pot to make this a reality.

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Gadgie2023@reddit

My work pension should give around £26k a year with a tax free lump sum of £120k. Add in some other investments and I should be alright. Looking to go at 60 but probably it will be 62/63.

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Matthew94@reddit

> > > > > Looking to go at 60 but probably it will be 62/63. You won't have long to enjoy your pension. rip

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Historical_Cobbler@reddit

I don’t know that answer, not sure anyone does with a degree of certainty. Ranges are given for what is needed to live, but where in the country will you be, and what lifestyle do you want and need is a huge factor.

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SproutsForMe@reddit

What helped me was creating a spreadsheet with a list of all my expenditure over a few years. Assuming your life is in a stable pattern you can use this as the basis for projections, adding in scenarios for differing inflation, interest rate changes, salary changes etc, and different retirement ages. If you do it right you can arrive at a number that is relatively accurate assuming no major changes in circumstances (which is a big assumption admittedly).

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Mobile-Stomach719@reddit

A lot of people fail to understand the disconnect between their annual salary and what they actually take home. There’s no NI deduction on your pension, nor will you be contributing to any more pensions from it. Work with what actually lands in your bank account each month and that’s your baseline here, ignore what your contracted salary is.

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Matthew94@reddit

>said that their family is struggling with money even when they are not even spending on anything And you took this at face value?

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Dramatic_Strategy_95@reddit

It's totally dependent on the circumstances of the individual. My overriding priotity is retiring in my early 60s in modest comfort so I'm aiming for my current annual living expenses accounting for inflation plus a £10K buffer. That should cover my basic needs and some discretionary spending.

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Exact_Setting9562@reddit

It's an impossible question. Do you holiday on your super yacht in Cannes all summer or have a weekend away in Bognor Regis? Shop at Asda or Harrods? Get your expenses sorted out and then you'll have a better idea.

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NastyMothman@reddit

I feel there will be more and more people that can't afford to retire in the future.

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knight-under-stars@reddit

More than is needed now. It's impossible to put a number on it as there are dozens of variables in play that dictate how much someone might need.

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