Pensioners issued savings warning as state pension may not cover surprise costs

When it comes to finances, people are well familiar with the notion of budgeting for their monthly outgoings. Whether it is rent or mortgage costs, electricity, gas, council tax, or any other bills, these are usually regularly occurring and straightforward to budget for.

However, sometimes things go wrong, and people who have not budgeted for them could suddenly be in a scramble for cash. A 2021 study from Yorkshire Building Society found 19 percent of people have savings of less than £100, while the number of people who are not actively saving has risen from 12 percent to 21 percent since 2019.

Unforeseen expenses can crop up from many areas of people’s lives, so it makes sense to account for them.

It may be more difficult for pensioners to cope with any unexpected costs, as their income will be lower than many people who are still in work, so they may not have as much flexibility to pay for sudden costs.

With the state pension not enough to live on by itself, the majority of retirees will need to have their own private pension funds in order to supplement their income just to get by in retirement, never mind having enough money to pay for a broken boiler.

Pensioners issued savings warning as state pension may not cover surprise costs
© GETTY pension saving rainy day fund retirement uk

Karl Tulloch, Owner of Rightio, believes older people could particularly benefit from a rainy day fund.

He said: “Retirees typically rely on savings or their pension rather than a monthly wage. Therefore, a built-up savings pot can be to their advantage and help them meet one-off costs which would typically be more manageable when working.”

Mr Tulloch provided some helpful tips for people who may not have enough money to pay for unexpected costs, suggesting how they can put themselves in a better position to weather any sudden financial storms.

What is a rainy day fund?

“A rainy day fund is smaller than an emergency fund, which is recommended for longer-term financial issues and should consist of three to six months of living expenses.

DON’T MISSTake care when gifting money to family – 5 mistakes to avoid or risk losing EVERYTHING [WARNING]State pension age increases set to impact free bus pass eligibility – are you affected? [ALERT]Four pension changes in 2022 that could see retirees getting hundreds more [INSIGHT]

“That doesn’t mean that you can’t build up a healthy pot of cash for unexpected costs though – we recommend putting towards your rainy day fund every month.

A rainy day fund is smaller than an emergency fund, which is recommended for longer-term financial issues and should consist of three to six months of living expenses, Mr Tulloch explained.

How much should people save?

“How much you save may depend on your personal circumstances – if you drive, it’s sensible to account for the costs of a car breakdown as well as these other common problems. If you don’t drive, you might not need to put as much away.

Pensioners issued savings warning as state pension may not cover surprise costs
© Express what is state pension

“Having an understanding of the rough cost of these surprise incidents will give you an idea of how much to put away. Making a list of the most likely problems and working out how much they’d cost if they happened is recommended.

“For example, gas boiler repairs cost between £150 and £400 on average, so putting away a minimum of £150 will help you cover that cost.”

How to start up a rainy day fund

“Many people find the idea of starting to save overwhelming, especially if you don’t have a lot of money left at the end of the month after your expenses.

“If you already have a structured budget and you’re aware of your monthly outgoings, you’ll know how much disposable income is left at the end of the month. This is a good place to start – so if you have £300 a month left over, you might want to put half of that into your rainy day fund, or even £100 a month.

Pensioners issued savings warning as state pension may not cover surprise costs
© GETTY pension saving rainy day fund retirement uk

“By working out how much you can afford each month, you’ll be able to work out how long it will take to reach your rainy day fund goal. If you’ve worked out that you’d need £1,000 to cover a broken boiler, a smashed phone screen, and car faults, and you put £100 away each month, you’ll hit that target in 10 months.

“But once you’ve reached that goal, you don’t have to stop contributing – if you can afford to, keep adding to your rainy day fund! You might even be able to finance something that you want, like a new car or a holiday, rather than only accounting for the unexpected.

“For many of us, £100 a month isn’t realistic. In fact, even £25 a month might feel like too much, and that’s okay. There are solutions available to people who find it difficult to put lump sums away, such as apps that round up your spending to the nearest pound, putting that extra money into a savings fund.”

Mr Tulloch also advised people check if they can reduce their monthly outgoings to open up more room for potential savings.

He said: “Reviewing your current bills to see if there are any savings you can make is also a good idea – especially if there’s no wiggle room in your budget at all. By using price comparison sites, you could get cheaper bills on your gas, electricity, phone, broadband, and more.

News Related


Explained- Who is Yevhen Murayev, named by Britain as Kremlin's pick to lead Ukraine?

© Provided by The Financial Express He began his political career in Kharkiv as an ally of the former President Viktor Yanukovich, who fled to Russia after the Maidan uprising. ... Read more »

Winter session to be held in new Parliament building, says Union Minister Hardeep Singh Puri

With the first phase of the Central Vista Project already completed, all eyes are now on the country’s new Parliament complex, which, according to Union Minister of Urban Development Hardeep ... Read more »

Twitter accounts of several Indian ministers hacked, official complaints lodged

© Provided by WION The official Twitter accounts of Indian Union Minister Rao Inderjit Singh,  Rajasthan Governor Kalraj Mishra and former Haryana Chief Minister Bhupinder Singh Hooda were hacked on ... Read more »

Who do Americans trust on the virus?

WASHINGTON — The Covid-19 pandemic has brought 20-plus months of uncertainty. And through the mask mandates and vaccine debates, Americans have developed a complicated and somewhat surprising set of voices ... Read more »

Farmers, opposition protest Spain's rural policies

MADRID (AP) — Farmers, cattle-breeders and hunting enthusiasts have descended on the country’s capital to protest against environmental and economic policies by Spain’s left-of-center government that they say are choking ... Read more »

Syria prison attack kills more than 100, clashes ongoing

© Provided by Al Jazeera The Kurdish-led SDF are battling ISIL fighters who tried to take over the Ghwayran Prison [Syrian Democratic Forces via AP] At least 120 people have ... Read more »

Mason Mount reflects on 'whirlwind' week when Tuchel replaced Lampard

Mason Mount has opened up on the ‘crazy’ first week after Thomas Tuchel replaced Frank Lampard as Chelsea manager. The Blues midfielder starred for the first team under Lampard, was ... Read more »

How did Nathaniel Atkinson perform on his Hearts debut?

© Hearts’ January signing Nathaniel Atkinson made his debut in the Scottish Cup win over Auchinleck Ta… The Australian played on the right of the midfield four in Hearts’ 3-4-3 ... Read more »

Venus Raj Reveals She Dated A Guy 12 Years Her Senior When She Was 16

© Provided by Cosmopolitan Philippines Venus Raj recently sat down for an intimate interview with Toni Gonzaga where she revealed that her first boyfriend was 12 years her senior when ... Read more »

Ina Garten's Lobster BLT Uses This One Ingredient to Elevate A Classic Sandwich

The Barefoot Contessa knows how to turn any dish into a main event – like this elevated Lobster BLT with avocado where she whips up a quick sauce with mayo, ... Read more »

Is the hiring problem actually the fault of HR departments?

Gregory Giangrande understands the struggle of finding a job and gives some tips on how to come out on top of the pack during the application process. Photo by FREDERIC ... Read more »

Cocaine worth €1.4 million seized after vehicle is searched at Dublin Port

COCAINE WITH AN estimated value of €1.4 million was seized at Dublin Port yesterday. As part of ongoing investigations targeting people suspected of involvement in transnational organised crime, a joint ... Read more »

Pinoy WBC world featherweight champ Mark Magsayo, idolo si Manny Pacquiao

© Provided by Ang protégé ni Senator Manny Pacquiao na si Mark Magsayo ang hinirang na bagong Filipino world boxing champion dahil siya ang nanalo sa World Boxing Council ... Read more »

Vice Ganda admits turning down offer to run for public office

© Provided by Minsan na palang naimbitahan si Vice Ganda na tumakbo sa pulitika. Ibinahagi ito ni Vice sa interview sa kanya ni Dra. Vicki Belo sa vlog ng ... Read more »

Karen Davila on presidential interviews with journalists: "Mas mahirap po magpatakbo ng Pilipinas kaysa humarap sa mamamahayag."

© Provided by Ayon sa ABS-CBN News anchor na si Karen Davila, mahalagang makisali sa mga interview sa mga mamahayag ang sinumang kumakandidato sa pagka-Presidente. Dito kasi mas nakikilala ... Read more »

James Yap given contract extension by RoS while on leave of absence

© Provided by PROPS to the PBA two-time MVP. Rain or Shine management has extended the contract of veteran star James Yap despite the star guard being on aleave of ... Read more »

Sofia Frank finishes 16th overall in ISU Four Continents Championship

Photo: Philippine Skating Union/Facebook Filipina figure skater Sofia Frank finished 16th overall in the ISU Four Continents Championship held recently in Tallinn, Estonia. Frank scored a total of 139.26 points ... Read more »

Vice President Naidu tests positive for Covid-19, self-isolates for a week

© Provided by DNA Vice President M Venkaiah Naidu tested positive for Covid-19 on Sunday (January 23). The vice president was in Hyderabad after a three-day long trip to Vishakhapatnam. ... Read more »

Syria: Intense fighting on for days after Isis tries to break inmates out of prison

© AFP via Getty Images Kurdish security forces deployed in Hasakeh city on 22 January as they try to take back control of a prison in Syria – AFP via ... Read more »

Justice KL Manjunath passes away: What you need to know about controversial ex-Karnataka HC judge

© Provided by Firstpost Justice KL Manjunath passes away: What you need to know about controversial ex-Karnataka HC judge Retired High Court judge Justice KL Manjunath died in the early ... Read more »

Secret ballot to elect president of Italy begins as Berlusconi drops out

© Provided by The Guardian Photograph: Alberto Pizzoli/AFP/Getty Images Italian parliamentarians will begin casting their votes for a new president on Monday after scandal-plagued Silvio Berlusconi abandoned his dream of ... Read more »

MP Nusrat Ghani alleges she was sacked job in PM Boris Johnson's government for being Muslim

© Provided by WION British MP Nusrat Ghani alleges she was sacked job in Prime Minister Boris Johnson’s Conservative government for being Muslim. The 49-year-old told the Sunday Times that ... Read more »

Shopping centre staff and customers ‘intimidated’ during anti-vax march

© PA Archive Scottish Defence League demonstration Two men have been arrested after “disruption and intimidation” was caused to staff and customers at one of Glasgow’s premier shopping centres during ... Read more »

Pundit makes Kalvin Phillips comment as Aston Villa player tipped for shock call

Aston Villa held out for a one-nil win away at Goodison Park as they faced a rejuvenated Everton side under Duncan Ferguson on Saturday. It was a good all round ... Read more »

'Like playing with 10' - Many Everton fans slam 'passenger' who lost 17 duels v Aston Villa

© Provided by Transfer Tavern Dominic Calvert-Lewin Everton Many Everton fans have been slamming the performance of Dominic Calvert-Lewin in their 1-0 loss at home to Aston Villa in the ... Read more »

TMC's proposal for Goa alliance not considered as it poached Congress leaders: P Chidambaram

© Provided by DNA Congress veteran P Chidambaram on Sunday said the Trinamool Congress’s (TMC) proposal of a pre-poll alliance for the next month’s Goa Assembly elections was not considered ... Read more »

India's cybersecurity needs to be strengthened to avoid online scams, says Ritik Davda

© Provided by Zee News Ever since the COVID-19 pandemic hit the globe, it has turned out to be a busy time for hackers. Working from home became the new ... Read more »

Mumbai: Dozens of Indian turtles die in suspected poisoning

Mumbai: Dozens of Indian turtles die in suspected poisoning Deliberate poisoning is likely to blame for the death of dozens of turtles at a lake near Mumbai, Indian wildlife experts ... Read more »

PRL Ahmedabad invites applications for Junior Research Fellow positions

The Physical Research Laboratory (PRL), Ahmedabad, is inviting applications for the post of Junior Research Fellow (JRF) for a period of two years. The recruitment drive will fill 2 vacancies ... Read more »

News updates from HT: Omicron-driven Covid-19 wave to peak by Feb 6, study says, and all the latest news

© Provided by Hindustan Times A health worker collects a swab sample from a man to test for Covid-19.  (Channi Anand / AP) Here are today’s top news, analysis, and ... Read more »

Sou Fujimoto creates House of Music in Budapest park "as a continuation of the natural environment"

© Provided by Dezeen House of Music in Budapest by Sou Fujimoto Japanese architect Sou Fujimoto has completed a museum dedicated to music topped with an undulating roof punctuated by trees in Budapest’s City Park.  ... Read more »

'There are now no plans...' - Tim Spiers makes significant Wolves January transfer claim

© Provided by Transfer Tavern Bruno Lage Wolves Wolves are not planning on signing a new centre-back in the January transfer window, according to reliable journalist Tim Spiers. The Lowdown: ... Read more »

Everybody knows my story now – Dave Ryding on making British skiing history

Dave Ryding reflected on his “crazy” journey to the pinnacle of his sport after becoming the first British skier to win an alpine World Cup gold medal in Kitzbuhel on ... Read more »

Is Nigeria vs Tunisia on TV? Time, channel and how to watch all today’s Africa Cup of Nations fixtures

© AFP via Getty Images Nigeria are one of the favourites to win this year’s Africa Cup of Nations – AFP via Getty Images Nigeria have been one of the ... Read more »

Tyson Fury claims Mike Tyson would have 'chinned' 'pair of p******' Anthony Joshua and Oleksandr Usyk in his devastating prime, with the Gypsy King stirring-up trouble as he prepares to re-enter the ring later this year

Mike Tyson wasn't impressed by Anthony Joshua's fight against Oleksandr UsykThe great heavyweight said both men had a 'bad night' when Usyk beat the Brit Tyson Fury has weighed-in to the debate, amid ongoing talks with Usyk's campThe Lancashire fighter had no doubt Iron Mike would beat eight of his rivals  Read more »

Video: Nicola Sturgeon refuses to rule out keeping Scotland's mask laws in place for YEARS as she blast Boris Johnson's Covid plan saying England is a global 'outlier' 

Read more »

This useful iPhone trick lets you copy text from photos

There’s a better way to digitize handwritten notes, old family recipes or any other hard paper copy you may have lying around. I’m not talking about taking a photo of ... Read more »

'Hearing Newcastle are ready to move' - Journalist drops big transfer update on PL 'machine'

© Provided by Transfer Tavern dele alli shoots against liverpool Pete O’Rourke has dropped some big transfer news involving Newcastle United and Dele Alli. The Lowdown: Lingard alternative? According to ... Read more »

British politician says she was sacked as a minister in Boris Johnson's government because she was a Muslim

© David Cliff/Anadolu Agency via Getty Images Conservative Party MP Nusrat Ghani addresses members of the Uighur community and human rights activists demonstrating outside the Houses of Parliament in London, ... Read more »

How my husband finally cracked and got a mobile phone

© Provided by The Guardian Photograph: Alamy In her new memoir, I Came All This Way to Meet You, the American novelist Jami Attenberg describes meeting a man who is ... Read more »
On you will find lots of free English exam practice materials to help you improve your English skills: grammar, listening, reading, writing, ielts, toeic