difference between UK retirees and US

[Rhodestine]

hi, I am new to forum but have been reading posts for sometime as I ponder my retirement plans (can I, can't I).

What strikes me is the seemingly huge difference between UK wannabe retires (and those already retired) and those in North America. UK newspaper regularly do "reviews" of folks wanting to retire, and their pension plans seem so pitiful to the USA folks. Examples "I am 63 with GBP80,000 in the bank and waiting for the state pension of GBP800 a month at the age of 66 - can I retire now?". It is hugely different to what I read in this forum of people with millions in cash, stocks and shares and property and still question whether they can afford to retire.

Is this because salaries are much higher in the US with lower taxes or because relatively wealthy Brits do not go on these types of forums (I cannot find such a good equivalent for UK retirees). Of course we do not have to worry about health care cover as we have the NHS.

Just throwing this out there, because to me it really makes me question whether I can retire early when comparing with what I read in this forum.

 

[joeea]

What strikes me is the seemingly huge difference between UK wannabe retires (and those already retired) and those in North America. UK newspaper regularly do "reviews" of folks wanting to retire, and their pension plans seem so pitiful to the USA folks. Examples "I am 63 with GBP80,000 in the bank and waiting for the state pension of GBP800 a month at the age of 66 - can I retire now?". It is hugely different to what I read in this forum of people with millions in cash, stocks and shares and property and still question whether they can afford to retire.

Pensions? Do most Brits have pensions? Most in the US do not have pensions.

At least for me, I have to focus on other assets. And without a pension and state-provided healthcare, the numbers have to be relatively large.

 

[latexman]

Of course we do not have to worry about health care cover as we have the NHS.

In the U.S., Heath Care is one of the major reasons we need bigger nest eggs + pension + SS + other income streams:

According to the Fidelity Retiree Health Care Cost Estimate, an average retired couple age 65 in 2019 may need approximately $285,000 saved (after tax) to cover health care expenses in retirement. Of course, the amount you’ll need will depend on when and where you retire, how healthy you are, and how long you live.

https://www.fidelity.com/viewpoints/personal-finance/plan-for-rising-health-care-costs

 

[ivinsfan]

In the U.S., Heath Care is one of the major reasons we need bigger nest eggs + pension + SS + other income streams:

https://www.fidelity.com/viewpoints/personal-finance/plan-for-rising-health-care-costs

You know I have retired family in the UK and due to many unhappy NHS experiences they pay extra for "private" insurance.

 

[ShokWaveRider]

You know I have retired family in the UK and due to many unhappy NHS experiences they pay extra for "private" insurance.

So do I, it is Still WAY more affordable than in the USA. Emergency and general HC is Excellent with the NHS, there are of course some exceptions, none of which are as bad as an insurance denying coverage for something, and one will never go bankrupt with it.

 

[george76]

You know I have retired family in the UK and due to many unhappy NHS experiences they pay extra for "private" insurance.

Is there an issue with pre-existing conditions in the UK with private insurance?

 

[Which Roger]

Is this because salaries are much higher in the US with lower taxes or because relatively wealthy Brits do not go on these types of forums (I cannot find such a good equivalent for UK retirees). Of course we do not have to worry about health care cover as we have the NHS.

I can't speak for the lack of wealthy Brits, but I think the reason that most members of this forum have significant assets is that those who don't can't really consider retiring early and would not be drawn to this forum.

 

[Exrook]

Pensions? Do most Brits have pensions? Most in the US do not have pensions.

In most countries, when you hear 'state pension' you can think of it as their counterpart to Social Security.

 

[Chuckanut]

I can't speak for the lack of wealthy Brits, but I think the reason that most members of this forum have significant assets is that those who don't can't really consider retiring early and would not be drawn to this forum.

Agreed. This group has a far higher financial awareness score than the average American, IMHO. And they were and still are willing to use that awareness to save and grow their net worth.

If you want to see a more representative sample of American, I could introduce you to a few people I met a at Thanksgiving. All are well into their 60's and none is financially well off. Three live together in one house, two still working outside the home. One person owns the house, works part time and rents out two rooms to the others at a very reasonable price. One person just gets SS and her job is to be the chief cook and housekeeper. The third gets SS and also works part-time at a low paying job. IIRC, all three have a Medicare Advantage plan that has little or no monthly fees. By combining resources they have managed to cobble together a decent living situation for all three of them.

What saves their bacon is the fact that one of them owns her house free and clear.

 

[Chuckanut]

I can't speak for the lack of wealthy Brits, but I think the reason that most members of this forum have significant assets is that those who don't can't really consider retiring early and would not be drawn to this forum.

Agreed. This group has a far higher financial awareness score than the average American, IMHO. And they are willing to use that awareness to grow their net worth.

If you want to see a more representative sample of American, I could introduce you to a few people I met a at Thanksgiving. All are well into their 60's and none is financially well off. Three live together in one house, two still working outside the home. One person owns the house, works part time and rents out two rooms to the others at a very reasonable price. One person just gets SS and her job is to be the chief cook and housekeeper. The third gets SS and also works part-time at a low paying job. IIRC, all three have a Medicare Advantage plan that has little or no monthly fees. By combining resources they have managed to cobble together a decent living situation for all three of them.

What saves their bacon is the fact that one of them owns her house free and clear.

 

[ivinsfan]

So do I, it is Still WAY more affordable than in the USA. Emergency and general HC is Excellent with the NHS, there are of course some exceptions, none of which are as bad as an insurance denying coverage for something, and one will never go bankrupt with it.

This is not a debate about different HC options. I simply pointed out my relatives in the UK made the decision to pay for private insurance which would need to be added to their retirement expenses.

 

[MRG]

So do I, it is Still WAY more affordable than in the USA. Emergency and general HC is Excellent with the NHS, there are of course some exceptions, none of which are as bad as an insurance denying coverage for something, and one will never go bankrupt with it.

Yeah, some folks don't understand what other people in the USA put up with. I've been fighting for surgery and Anthem denying prior authorizations. Sending me to providers who have no way of contacting them....

I'm considering paying out of pocket only I have no idea if it's 5k or 50k! Obviously no way of finding any more information.

I used to think we had decent but expensive health care, not anymore.

 

[ivinsfan]

Yeah, some folks don't understand what other people in the USA put up with. I've been fighting for surgery and Anthem denying prior authorizations. Sending me to providers who have no way of contacting them....

I'm considering paying out of pocket only I have no idea if it's 5k or 50k! Obviously no way of finding any more information.

I used to think we had decent but expensive health care, not anymore.

I'll tell you what I told SWR..this is about the cost of British retirements, which in the case of some couples includes paying extra for private insurance. I don't want to be responsible for a thread hi-jack.

 

[ivinsfan]

Is there an issue with pre-existing conditions in the UK with private insurance?

I don't know the answer to this one.

 

[copyright1997reloaded]

America is the land of milk and honey.

The USA has the 3rd highest purchasing power index and 2nd lowest property price to income ratio (both according to Numbeo): https://www.numbeo.com/quality-of-life/rankings_by_country.jsp

In addition, since the USA population is 6X the UK's, you would expect to see a lot more on-line discussion of retirement by those from the USA.

 

[Alan]

hi, I am new to forum but have been reading posts for sometime as I ponder my retirement plans (can I, can't I).

What strikes me is the seemingly huge difference between UK wannabe retires (and those already retired) and those in North America. UK newspaper regularly do "reviews" of folks wanting to retire, and their pension plans seem so pitiful to the USA folks. Examples "I am 63 with GBP80,000 in the bank and waiting for the state pension of GBP800 a month at the age of 66 - can I retire now?". It is hugely different to what I read in this forum of people with millions in cash, stocks and shares and property and still question whether they can afford to retire.

Is this because salaries are much higher in the US with lower taxes or because relatively wealthy Brits do not go on these types of forums (I cannot find such a good equivalent for UK retirees). Of course we do not have to worry about health care cover as we have the NHS.

Just throwing this out there, because to me it really makes me question whether I can retire early when comparing with what I read in this forum.

Welcome to the site.

Retirement is all about affordability so the first steps to take would be to examine your expected expenses once you retire. The cost of living varies a lot in the UK depending on where you live. What do you expect your expenses to be where you live, or where you plan to live in retirement?

Tomorrow we are off to the Scilly Isles with a couple of longtime friends in their mid 70's who were both school teachers and retired at age 60. They have 2 daughters and 4 grandchildren, and they travel more than anyone else I know. They have a Static caravan in The Lake District and a touring caravan with which they go all over the country, plus they go abroad multiple times a year. Already they have been to France and Spain this year. They both grew up in inner cities and have received no large inheritances from parents. They are indeed what I would consider typical British pensioners, living on their teacher pensions and UK SS, a.k.a. the State Pension. We have similar stories about other ordinary pensioners we know in our town.

Once you have no mortgage the property taxes, a.k.a. Council Tax, are very reasonable where we live, ~$2,000/year for a 3 bedroom house. We own a 2 year old Toyota Prius which costs $240/year to insure, our house insurance, contents, bricks and mortar costs $250/year. TV licence costs $200/year and that gets you about a bunch of free channels from the BBC and ITV that you can get OTA or via the internet so no cable company needed unless you want movie and/or sport channel packages, but you could cherry pick some of those with the likes of Amazon Prime, Netflix etc.

UK folks at age 60 also get free eye checkups, free prescriptions and in some parts of the country free bus passes. Where we live the free bus passes arrive at State pension age which for us will be 66.

 

[ShokWaveRider]

This is not a debate about different HC options. I simply pointed out my relatives in the UK made the decision to pay for private insurance which would need to be added to their retirement expenses.

The point being you need to be a lot wealthier in the USA to have a comfortable retirement, even more so ER., as there are a lot of obstacles along the way. The Main one being the cost of HealthCare, for some it can be devestating, so it is relevant.

 

[Alan]

Is there an issue with pre-existing conditions in the UK with private insurance?

Yes. Just like most insurance you can't buy it to fix a problem you already have. The NHS covers everything including pre-existing conditions. Immigrants on temporary visas have to pay an annual NHS surcharge of a few hundred dollars per year until they get permanent residency status and it doesn't matter if they have pre-existing conditions.

 

[ivinsfan]

The point being you need to be a lot wealthier in the USA to have a comfortable retirement, even more so ER., as there are a lot of obstacles along the way. The Main one being the cost of HealthCare, for some it can be devestating, so it is relevant.

Agree but I was simply responding to the poster that said retired people have no HC costs in the UK, some retirees in the UK do have extra costs.

 

[JoeWras]

Once you have no mortgage the property taxes, a.k.a. Council Tax, are very reasonable where we live, ~$2,000/year for a 3 bedroom house. We own a 2 year old Toyota Prius which costs $240/year to insure, our house insurance, contents, bricks and mortar costs $250/year. TV licence costs $200/year and that gets you about a bunch of free channels from the BBC and ITV that you can get OTA or via the internet so no cable company needed unless you want movie and/or sport channel packages, but you could cherry pick some of those with the likes of Amazon Prime, Netflix etc.

Wow! That's a huge chunk of cost that is significantly less than USA, especially insurance.

I thought the TV licence was OTA only. So it includes internet? That helps take away the sting. Is it BBC and ITV only though?

 

[Big_Hitter]

Just throwing this out there, because to me it really makes me question whether I can retire early when comparing with what I read in this forum.

not sure how they do it in the UK but here, we tend to look at one equation to determine whether or not one can afford to retire:

I>E ?

 

[Aerides]

Agree but I was simply responding to the poster that said retired people have no HC costs in the UK, some retirees in the UK do have extra costs.

From what I understand (been a while for me), most of these private insurance plans in the UK (such as a BUPA plan) act as supplemental to the NHS, not instead of, and they are at far more reasonable rates than what we think of in the US.
The private plans generally help with things like expediting non-emergency care, private hospital rooms, etc., or at least that was my parents experience. Others can chime in better, but it's not the same as a US private plan by any stretch, and it's not "some people forgo the NHS and just buy private because that's better."

 

[Alan]

Wow! That's a huge chunk of cost that is significantly less than USA, especially insurance.

I thought the TV licence was OTA only. So it includes internet? That helps take away the sting. Is it BBC and ITV only though?

Several of the OTA stations provide free apps such as iPlayer, ITVHub, UKTVPlay, All4 etc allow free streaming as well as box sets and recorded programs. One buys the internet access from a provider of your choice, $30 -
40/month will get you high speed broadband, then a smartTV, Chromecast, AppleTV, Firestick will allow you to watch all the programs on your TV.

 

[ivinsfan]

From what I understand (been a while for me), most of these private insurance plans in the UK (such as a BUPA plan) act as supplemental to the NHS, not instead of, and they are at far more reasonable rates than what we think of in the US.
The private plans generally help with things like expediting non-emergency care, private hospital rooms, etc., or at least that was my parents experience. Others can chime in better, but it's not the same as a US private plan by any stretch, and it's not "some people forgo the NHS and just buy private because that's better."

Yes it would something along the lines of a Medigap policy..I think...

 

[MRG]

The point being you need to be a lot wealthier in the USA to have a comfortable retirement, even more so ER., as there are a lot of obstacles along the way. The Main one being the cost of HealthCare, for some it can be devestating, so it is relevant.

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