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Cost of happiness

Smart Finance

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Feb 23, 2021
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Do you know the cost of happiness?
There has been a study of the price of happiness, they used data collected by the Office of National Statistics (ONS) and analysed data from the well-being reports and the Happy Planet Index to reveal the cities in the UK where money can buy happiness.

The average annual cost of happiness in the UK is £33,864. If you can save enough in your pension pot to retire on more than £30,000 a year, you’ll be amongst the happiest people in the UK.


https://www.raisin.co.uk/newsroom/articles/does-money-buy-happiness/

Now looking into the cost of happiness and the 4% withdrawal rule as a base from the Trinity Study we find that the pension pot required to buy happiness would be £846,600.

This is a lot more than the recommended £237,500.

But in reality this data is skewed as it does not represent retirement but includes working families of all ages.

There is a lot to take in researching your golden number for retirement.

Questions you will have to ask are:

  1. Will i be renting, paying a mortgage or will i own a property outright
  2. How many holidays do i want per year
  3. Overall lifestyle (eating at restaurants and activities)
  4. Will i spend more on heating
  5. Will i have any debts (Credit card, personal loans or car finance)
  6. Partner expenses
  7. Other types of incomes
  8. How the benefit system could change
  9. State pension age

These are all good questions to ask yourself when coming to the conclusion of the expenses you expect at retirement and the kind of pot you'll be looking at requiring for your desired lifestyle.

Does this suprise anyone?