Achieving lifetime goals ‘costs close to £1m’

New figures published by Lloyds Bank have highlighted the average cost for couples of meeting their "life goals", with the typical couple spending close to £1 million to achieve their lifelong aims.

According to the latest Lloyds Bank Family Savings report, UK couples will spend on average £877,000 on such important life events as getting married, buying their first home, having children and funding their retirement, with this figure reaching £1.2 million in London.

All of these events obviously add up for households and it is therefore interesting to see how individuals generally pay for these things, with 50 per cent of wedding costs typically paid for through borrowing and nine per cent of the costs of having a baby also paid for in this manner.

When it comes to buying a home, there are very few Brits who can do this without the need to borrow significant amounts, highlighted by the fact that the average first-time buyer in the UK now puts down a 20 per cent deposit on average, meaning that when buying their home up to 80 per cent of the cost is typically borrowed from the banks.

Overall, the average cost of a wedding in the UK now stands at £11,168, while the typical cost of purchasing a three-bedroom, semi-detached house – the most common type of family property in the UK – is £174,129.

Meanwhile, the average combined first-year cost of having two children is now £6,138 and the average amount required by couples to fund a comfortable retirement was shown to be £685,339.

Finally, the average additional cost of miscellaneous life events prior to retirement for couples in the UK is £191,735, bringing a grand total of £877,074 needed to ensure couples are able to achieve their lifetime goals.

The point in life at which individuals are able to pay off their mortgage was also highlighted in the research, with the age at which couples began seriously saving for the future shown to have a considerable impact on their ability to fund a comfortable lifestyle as they get older.

Respondents on a middle income between the ages of 45 and 64 were asked to state whether or not they had reached a stage where they now owned their home outright and if they held any other non-cash investments.

Overall, individuals who said they had started saving in earnest in their early 20s were able to make this claim in 55 per cent and 60 per cent of cases, compared to just 18 and 23 per cent of those who stated they had never saved regularly.

As a result, the importance of regular saving and planning for the future was highlighted for those individuals who hope to achieve a more comfortable retirement.

Responding to the report, savings director at Lloyds Bank Philip Robinson commented: "The average cost of meeting our lifetime goals is almost a million pounds, which is a daunting figure for anyone.

"However, the report clearly shows that by getting into the saving habit early you can significantly improve your financial health later in life."

Posted by James Francis