The Motley Fool

Worried about how to survive on the £8,767 State Pension? Here are 3 moves I’d make today

With the State Pension amounting to just £8,767 per year, many people may be concerned that it’s insufficient to enjoy financial freedom in older age. That’s especially the case since the average UK salary is around £27,000 per year, which means it may be tough to even survive on the State Pension alone in some parts of the country.

While the prospect of this may be disconcerting, it’s possible to build a nest egg by retirement for a second income. Doing so may be simpler than many people realise, with even modest amounts of savings each month potentially producing a sizeable amount when commission costs are minimised and growth prospects are maximised.

5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!

According to one leading industry firm, the 5G boom could create a global industry worth US$12.3 TRILLION out of thin air…

And if you click here we’ll show you something that could be key to unlocking 5G’s full potential...

Regular investing

For many people, the possible costs involved in investing in the stock market can dissuade them from buying and selling shares. However, with the advent of online sharedealing, even investors with very limited capital can buy shares in order to generate that nest egg.

In order to further reduce commission costs, it may be a good idea to utilise the regular investing services offered by many sharedealing providers. This is where orders from a wide range of their clients are aggregated and then executed on a specific date that’s known in advance. Although this means investors have less influence on precisely when their shares are purchased, it can mean dealing charges fall to around £1.50 per transaction. As such, it could make investing in the stock market more accessible to a wider range of people.

Risk/reward ratio

While nobody wants to lose money on the stock market, it’s a given that there will be volatility in share prices over a variety of time periods. However, this doesn’t mean risky investments should necessarily be avoided. As long as an investor has a diverse portfolio and a long-term time horizon, there’s a good chance downturns and challenging periods for their portfolio will be reversed over a period of years.

Therefore, if an investor has a decade or more until they plan to retire, it could be worth focusing on growth shares. They could be more volatile in the short run, but may ultimately produce a larger nest egg in the long run.

Invest often

While it may be tempting to try and time the market, in terms of buying while it’s at a low ebb, doing so is notoriously challenging. There are a variety of factors that influence share prices, and they can be difficult to accurately consider for even the most experienced of investors.

As such, it may be a better idea to simply invest frequently. With the FTSE 250 having recorded an annualised total return of over 9% in the last 20 years, the potential to earn significant returns from simply matching the wider index’s performance could be high.

5G is here – and shares of this ‘sleeping giant’ could be a great way for you to potentially profit!

According to one leading industry firm, the 5G boom could create a global industry worth US $12.3 TRILLION out of thin air…

And if you click here, we’ll show you something that could be key to unlocking 5G’s full potential...

It’s just ONE innovation from a little-known US company that has quietly spent years preparing for this exact moment…

But you need to get in before the crowd catches onto this ‘sleeping giant’.

Click here to learn more.

Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.

Our 6 'Best Buys Now' Shares

The renowned analyst team at The Motley Fool UK have named 6 shares that they believe UK investors should consider buying NOW.

So if you’re looking for more stock ideas to try and best position your portfolio today, then it might be a good day for you. Because we're offering a full 33% off your first year of membership to our flagship share-tipping service, backed by our 'no quibbles' 30-day subscription fee refund guarantee.

Simply enter your email address below to discover how you can take advantage of this.

I would like to receive emails from you about product information and offers from The Fool and its business partners. Each of these emails will provide a link to unsubscribe from future emails. More information about how The Fool collects, stores, and handles personal data is available in its Privacy Statement.