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Annual retirement costs reach over £11,000


The minimum costs for pensioners to eat, stay warm and have a roof over their heads has risen 8% in the last 12 months to £11,200 per year.

Research of government figures on household expenditure from Key Retirement has shown that the annual cost of being a pensioner has risen to £215 a week. These costs come from spending on the basics including food, clothes, travel and heating. Much of the spike in cost has been due to the increase in soaring price of travel costs. This increased almost £200 in the year, meaning that travel took up an incredible 11% of household budgets, just after 15% on fuel and housing, and 14% on food and non-alcoholic drinks.

The average cost around the country varies, with retired people in the North East needing £9,630 a year compared to £13,216 in the South East. The most expensive places to live were The South East (£13,216), London (£12,992), the East of England (£11,760), the South West (£11,648) and Northern Ireland (£10,976). The cheapest places to buy the basics were the North East (£9,630), Yorkshire and Humberside (£9,744), Wales (£9,856), Scotland (£10,080) and the West Midlands (£10,270).

Key Retirement would like people approaching pension age to maximise their income from all sources available to them to ensure they have enough money to cover the annual costs they will be paying.

Dean Mirfin, group director at Key Retirement, said:
“It is crucial that pensioners and those in the run-up to retirement focus on their retirement income as the current basic State Pension, and even the new State Pension planned for next year, will not cover the basic costs of being retired in any region of the UK.
“Anyone approaching retirement will need to find other income in order to meet the basic costs and should look at all their assets including savings or pensions, plus the money invested in their home. On average customers released nearly £64,800 from their homes last year through equity release; which could, for many, prove life-changing in meeting the costs of retirement.”

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