Retirement costs to consider
The calculator will ask how much yearly income you think you'll need in retirement. You might base your calculations, as an example, on two thirds of your working income. Our spending patterns tend to change in retirement, so there are a number of things to consider.
Mortgage(s)
Most mortgages are designed to be paid off by retirement, so this expense should disappear. However, if you have an interest-only mortgage you may need to consider how to pay this off. Check your mortgage paperwork to make sure you're on track.
Transport
If you currently commute, your spending on transport could drop drastically - although if you lose a company car on retirement, you may need to factor in the price of replacing it and keeping it on the road.
Health and insurance
Insurance costs for your car or health, for example, are likely to increase in retirement and you may want to consider paying for private operations.
Family
Spoiling the grandchildren could mean more than a few trips to the zoo. These days, living expenses are much higher than they used to be and sometimes grandparents like to help out.
Travel
Many of us dream of travelling more when we retire, so you could end up adding to your outgoings here.
Utility bills
If you're spending more time at home rather than at work, you may find you're spending more on heating and light, though you may receive some help from the state.
Tip:
The cost of living for people in retirement tends to rise faster than general inflation, so you may need more than you think to live comfortably.
