The Sunday Times revealed its annual Rich List yesterday, the definitive guide to the UK’s most wealthy.
While the list is reserved only for the super-rich, there is another exclusive club ‘The Retiree Rich List’ which now has a surprising number of members.
According to research from financial planning group Tilney, 1.7 millon of us – that’s 6% of UK households – will spend over £1 million in our retirement years alone.
This privileged group has far more disposable income than the average household and they devote it disproportionately to the finer things in life.
In fact, this wealthy top 6% of over-65s will spend around £410,000 on entertainment, holidays, restaurants and cars in their remaining years – this is around the same amount of money that the average retired household will spend on everything.
One key difference for this group is health and personal care. Not only are they more likely to devote resources to private medical treatment, but since their later-life care costs are means-tested, they must also fund these, should they need them, without support from the state.
The richest 25% of retirees
The average household spends roughly £420,000 in retirement years, but for the richest 25% of people in the UK, this jumps to £684,000. After the age of 65, this upper wealth quartile will spend £74,000 on holidays, £66,000 on entertainment and recreation and £42,000 eating out. They will also spend £38,000 on health and personal care and £15,000 on alcohol and tobacco.
Across their whole lifetime, members of this upper wealth quartile will spend more than £2.8 million.
- If you’re worried about having enough for retirement, read How much do I need to save for retirement? and How much do I need to pay into a pension?