How does your spending change when you work less?
Most people find some costs fall and others rise. The money that went on getting to and from work, and on being at work, tends to shrink. The money spent at home and on free time tends to grow, because you have more of both.
- Often falls: commuting and parking, work clothes, lunches and coffees out, pension contributions if you pay in less, and sometimes the mortgage if it is paid off or nearly so.
- Often rises: heating, energy and water, because you are home more in the day; hobbies, eating out and holidays, because you finally have the time; and, later on, health and personal care.
- Usually stays put: council tax, insurance, food and the regular household bills.
That is why a budget built only on “spend a bit less” can surprise you. Going line by line, as this calculator does, shows where the real changes are. For many people, the shift from saver to spender is as much about feelings as figures.
How does your budget compare with the Retirement Living Standards?
The June 2026 Retirement Living Standards put yearly spending at £13,900 (minimum), £32,700 (moderate) and £45,400 (comfortable) for one person, and £22,500, £45,400 and £62,700 for a couple.
| Standard | One person | Couple |
|---|---|---|
| Minimum | £13,900 a year (about £1,158 a month) | £22,500 a year (about £1,875 a month) |
| Moderate | £32,700 a year (about £2,725 a month) | £45,400 a year (about £3,783 a month) |
| Comfortable | £45,400 a year (about £3,783 a month) | £62,700 a year (about £5,225 a month) |
These figures are spending after tax and assume you own your home outright, so they leave out rent and mortgage payments. To compare like with like, the calculator leaves out your housing line, and your saving and pension contributions too, because those are money put aside rather than spent.
Subscription audit: what to check before you dial down
Regular payments are easy to forget and easy to trim. Going through them once, before your income changes, often frees up more than people expect.
- Music, film and TV streaming services, including any you share or rarely watch
- Pay TV packages and add-ons
- Mobile phone contracts that have ended their minimum term
- Broadband deals that have rolled onto a higher out-of-contract price
- Gym, club and class memberships you no longer use much
- Magazine, newspaper and app subscriptions
- Cloud storage and software plans
- Breakdown cover, phone or gadget insurance and extended warranties that may overlap with cover you already have
- Subscription boxes and delivery memberships
- Charity and membership direct debits you want to keep, but at a level that suits your new budget
- Free trials that turned into paid plans
- Annual renewals: car, home and travel insurance and any yearly memberships
Your banking app or a few months of statements will show your regular payments in one place. Keeping something you love is a good choice too: the point is to choose, not to cut everything.
Worked example
This is an example, not a real household. It is the budget the calculator starts with. A couple are thinking about dialling down their work. They own their home with a mortgage still running, and they expect a combined take-home of £3,750 a month afterwards.
- Now: they spend £4,290 a month, or £51,480 a year, including £600 a month going into savings and pensions.
- After they dial down: £3,890 a month, or £46,680 a year. That is £400 a month less, or £4,800 a year.
- What changes most: saving and pension contributions fall by £300 a month, transport and commuting by £200 a month, and hobbies and eating out rise by £70 a month.
- Against the standards: without their £1,100 mortgage and £300 of saving, they would spend £29,880 a year. That reaches the minimum standard for a couple, £7,380 above it, and is £15,520 below the moderate standard.
- Against their take-home: £3,750 a month leaves a gap of £140 a month, £1,680 a year. People in this position often look at options such as adjusting a category or two, drawing on savings for a while, or a different level of work. The glide planner and bridge years explore these.
Questions people ask
How much money do I need a month to retire in the UK?
The June 2026 Retirement Living Standards work out at about £1,158 a month for a minimum, £2,725 for a moderate and £3,783 for a comfortable retirement for one person, and about £1,875, £3,783 and £5,225 a month for a couple. That is spending after tax, and it assumes you have no rent or mortgage to pay.
How do I make a retirement budget?
Start with what you spend now, category by category, using a few months of bank statements. Then go through each line and ask how it would change if you worked less or stopped. Add up both columns, compare the after total with the income you expect, and look again at the biggest lines first.
What expenses go down in retirement?
Work costs usually fall first: commuting, parking, work clothes, lunches and coffees out. Pension contributions often stop or shrink, and some people have paid off their mortgage. Costs that tend to rise are heating and energy, because you are at home more, and leisure, hobbies and travel, because you have more time.
Do the Retirement Living Standards include housing costs?
No. The standards assume you own your home outright, so they leave out rent and mortgage payments. That is why this calculator compares your spending without the housing line. If you will still pay rent or a mortgage, add it on top of the standard you are aiming for.
How this works and what it assumes
It adds up your two columns, multiplies by 12 for yearly totals, and ranks the three categories that change the most in pounds, up or down.
- Totals: every category is included in your monthly and yearly totals, including housing and saving. An empty “after” box counts as the same as now.
- Biggest changes: categories are ranked by the size of the change, whichever way it goes.
- Retirement Living Standards: your after spending is compared without housing (rent or mortgage) and without saving and pension contributions, because the standards are spending after tax with no housing costs.
- Surplus or gap: if you enter a take-home figure, the calculator takes your after total away from it.
It does not adjust for inflation or tax, and it treats every amount as monthly. Spread yearly costs, such as insurance or holidays, by dividing them by 12. For free, impartial help with budgeting and your pension options, MoneyHelper and, from age 50, a Pension Wise appointment are good places to start.
Guidance, not advice. This tool gives general guidance based on the information you enter. It is not financial advice. For free, impartial help, visit MoneyHelper or book a Pension Wise appointment.
Sources: Retirement Living Standards (Pensions UK, June 2026) · MoneyHelper.
Last checked 9 October 2026 · How our tools work