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Retirement can be an expensive time in people’s lives, particularly as income streams can be greatly reduced during this period. This time in one’s life should be a chance for people to enjoy life freely without work commitments and to be as happy as they can be. But many people are forced to make serious concessions when it comes to their plans because the cost of retirement is so extensive. But how can you save up to £200,000 during your retirement years?
Retirement is a period in one’s life that many look forward to eagerly.
But ensuring you have a pension pot large enough for the life you want to lead during these years is essential.
According to 2021 research, couples in the UK need a minimum annual income of £15,700 to survive their retirement.
For those hoping to live a moderate lifestyle during these years, they need an annual income of £29.100.
Anyone wanting to live comfortably will need a pension income of £47,500 a year.
How can you save up to £200,000 during your retirement years?
Retiring in the UK and the amount one needs to survive, live moderately or comfortably, is highly dependent on where one resides.
For those who retire in London, it can cost almost twice as much as Britain’s cheapest cities.
Pensioners can in fact save up to £200,000 by moving somewhere cheaper.
Living in London requires a pension of up to 82 percent larger than in the cheapest major city in the UK, Nottingham, according to Salisbury House Wealth, a financial adviser.
A comfortable retirement life in London would cost £25,471 a year – meaning it would cost a 67-year-old £458,478 to generate this income from a fixed term annuity, lasting until age 86.
However, for those living in Nottingham, an income of £16,786 per year, costing £251,790, would equate to the same standard of living.
For those in Britain, a decent nest egg can vary up to £207,000 – depending on where one lives.
This cost of retirement is matched by the average life expectancy.
Those in London, on average, live until the age of 86, the highest of any place in the country.
Those living in Northampton have the shortest life expectancy of any place in the UK, at 82 years on average.
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Followed by London, those living in Edinburgh, Stockport, Brighton and Hove and Milton Keynes are facing the highest costs for their retirement years.
Each of these places all cost more than £21,600 a year to retire in.
However, if those living in these cities were to move to more economical places – these retirees could make huge savings.
The cheapest areas in the UK to retire include Leicester, Nottingham, Kingston upon Hull, Wolverhampton and Portsmouth.
Retirees needed £8,000 less at £16,200 per year to live in Leicester.
The most expensive of these cheaper cities was Portsmouth, where £17,160 a year was needed to retire, according to Salisbury House Wealth.
According to a recent pension survey from Legal & General, three million people aged 50 and over are planning to relocate as a result of the pandemic.
They are seeking more rural settings instead of cities – which has prompted a surge in prices for these locations.
Areas of outstanding natural beauty have been most popular with the over-50s contingent and are likely to continue to be so in the coming weeks, according to property experts.
Relocating can have a number of additional benefits which help people save money, including a drop in the cost of living.
Downsizing can also free up cash to help people fund their retirement lifestyles.
Claire Singleton, of Legal & General, said: “There can be many benefits to relocation, whether it is a better quality of life, more space or even the opportunity to be closer to loved ones.
“As with many aspects of our lives, the challenges of the pandemic seem to have led many people to take stock of their current living situation.”
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