The only thing standing between you and a more comfortable retirement is … you!
New research suggests that most people waste £124 a month on takeaway snacks, coffee and designer clothes.
And if that money was saved instead, most people would be £9,024 a year better off in retirement after taking economic growth and interest into account.
That’s a staggering £189 a week to spend on top of the state pension and any other savings.
The obstacle to a better lifestyle in retirement is you.
Researchers from financial firm Scottish Widows found around 1 in 8 people had no idea about how much they spend on those little luxuries or impulse purchases and do not bother tracking their spending.
Spending now means less money tomorrow
Another third refuse to believe they could save any more money than they do already.
But the research showed most of us underestimate our spending by around £74 a month and that a lot more hidden expenses can reveal themselves.
Robert Cochran, a retirement expert at Scottish Widows, said: “January is traditionally a time when we set out to improve our financial habits for the year ahead and while it would be unrealistic to suggest we live entirely without little luxuries, there is an important message about the need to ensure untracked spending today doesn’t harm our financial security tomorrow.”
He suggests staying in more, switching takeaways for home cooking and taking sandwiches and a flask to work instead of buying coffee and treats.
The figures in the report are based on a 22-year-old saving £124 a month into a pension until the age of 68.
Where the money is wasted
|Luxury purchase||Average yearly cost||What saving could add to a pension|
|Buying equipment for hobbies not kept up||£26.19||£148.00|
|Taking public transport when you could walk||£45.35||£222.00|
|Ordering a taxi when you could take public transport||£50.98||£296.00|
|Buying a hot drink from a coffee shop||£83.41||£444.00|
|Buying clothes that are never or rarely worn||£94.61||£592.00|
|Picking up a ready meal, rather than cooking from scratch||£130.38||£814.00|
|Buying lunch rather than making sandwiches||£141.35||£888.00|
|Buying snacks and sweet treats||£177.68||£1,109.00|
|Ordering a takeaway when you have food at home||£201.88||£1,257.00|
|Eating out (eg dinners, lunches)||£308.94||£1,849.00|
Source: Scottish Widows