Pensioners can save hundreds of pounds a year with simple changes

Jonathan Watts-Lay from WEALTH at work spoke to Express.co.uk about how pensioners can rearrange their finances to save on costs, freeing up funds to go towards enjoyable pursuits such as holidays or leisure activities. He said people often miss out on big savings because they don’t shop around when paying for essentials.

He said: “Things like car insurance, household insurance, broadband payments, mobile phone payments, subscription services.

“You’d be amazed by the number of people that don’t shop around for those things. Often they will have subscriptions they don’t even use.

“We can literally save them hundreds of pounds a year and they haven’t given anything up, all they’ve done is get a better car insurance deal or better phone deal or a better broadband deal.

“They’ve freed up a few hundred quid for that year, and then that few hundred quid can go and pay for a holiday.”

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He said another mistake people often make when it comes to planning their finances for retirement is to assume they will need the same income as when they were working, to cover their costs.

He said people sometimes forget to factor in the fact they will no longer pay National Insurance, income tax, or their commuting and other work costs, as well as no longer paying into their pensions.

Mr Watts-Lay said: “One of the mistakes people make is, if my net income was £2,000 a month when I was in work, then I still need £2,000 when I retire.

“You probably don’t need to do that. We try and work through what those differences are.”

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“Because they’ve been waiting to retire, they go off travelling, they do all those hobbies they never had time for.

“As people get older, they naturally slow down. By the time you’re hitting 80, you’re probably not doing the things you did when you were 65, when you first retired.”

Mr Watts-Lay explained people should be aware as they get into their older years, healthcare costs will likely increase, with the potential to eventually have to pay for a care home.

The planning expert stated people should also consider the emotional importance of the different things they spend their money on.

He added: “You don’t care whether your car insurance is with Admiral or Churchill, all you care about is if the cost of cover is good value for money and you’re getting the level of cover that you need.

“If you turn round to someone and say, ‘Don’t go to the local pub or don’t go out for those coffees with your friends, because you’d save £10 a week’, then you’re not just talking about them saving £10 a week, you’re basically pulling away their social life.

“It’s about talking through those things where there is an emotional attachment, and what are those things where there is no emotional attachment.

“The ones where there’s no emotional attachment are the ones which are really easy to change.”