Annual retirement costs reach over £11,000
24/02/2015
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.”
Need financial advice?
If you have any personal finance questions related to this news article, then please contact our financial advisers. You can get in touch by asking a question online, calling us on 0800 092 1245, or by arranging a visit.
Share this..
Related stories
Past 12 months see sharp rise in demand for financial advice
23/04/2015 There has been a sharp rise in people looking for financial advice over the past 12 months, with more than a third of accountants experiencing an increase in potential clients. Research from Investec Wealth & Investment showed that 37% of accountants had seen a sharp rise in demand for advice, with the majority of consumers needing guidance on pensions, followed by inheritance tax...
Read MoreOld system leads to more personal pensions complaints
The number of complaints about personal pensions providers has soared by 43 per cent over the past year, according to the Pensions Advisory Service (TPAS), leading the advice service to say the system must be updated.While administration grievances constituted over 30 per cent of complaints filed, TPAS has said that it is not the whole sector that is at fault and claims that a new system of regula...
Read MoreSIPP restrictions
There are some restrictions designed solely to prevent abuse of the Self-Invested Personal Pension (SIPP). Any SIPP holding prohibited assets directly or indirectly will have all tax advantages removed, which will broadly mean that it is at least no more advantageous to hold such assets in a pension scheme than it is to hold them personally. Prohibited assets include direct or indirect investm...
Read MoreHow are so many pension schemes in deficit?
While the British Telecom final salary pension scheme is currently attracting all of the headlines, there are many more major UK pension schemes in significant deficit. As we have covered on numerous occasions, the situation has arisen because of a number of factors which include:-
The assumption that the average pensioner will live longer than first thought
A redu...
Fidelity Survey Shows Average UK Pensions Are Less Than The Minimum Wage
Even though there have been concerns about a pension crisis in the UK for many years it seems that those only now reaching retirement age are set to feel the full force of the situation. The recent Fidelity survey has found that the average UK pension income for those in retirement will be in the region of £215 a week – less than the minimum wage for a standard working week!
...