As the first polymer five pound notes arrive in our wallets, analysis from retirement income specialists, Retirement Advantage, reveals that over 65s in the UK spend a greater proportion of their money on lifestyle products and services than on essentials*.
Andrew Tully, Pensions Director at Retirement Advantage commented, “With the launch of the new polymer five-pound note we wanted to investigate how older people really spend their money. It’s clear [from our analysis] that older people want to have fun, not just survive. Our research tells us many plan to prioritise quality of life in retirement above simply making do.”
The news that retirees are spending their money on having fun, improving their social lives and holidaying comes as no surprise to us. We carried out research earlier in the year which revealed that almost three quarters of people want to travel more when they retire.
Today’s over-50s view retirement as an opportunity to do all the things they may not have had time for in the past. With many people now spending a third of their life in retirement, they need to plan their finances well to fund the lifestyle they aspire to.
One good financial solution may be to sell the family home and downsize – either to rent a retirement property on an assured tenancy or to buy. This can free up capital to invest or spend on family or to travel if they wish, and can remove the cost and worry of maintaining a larger home.
Living in a retirement development offers a ready-made community of like-minded people which can provide retirees with a great social life and is particularly important for those on their own. Another advantage is that those who wish to travel can ‘lock up and leave’ their apartment knowing that it is safe and secure while they are away.