Where can you live off a state pension?

Picodi.com analysts researched the amount of retirement benefits in 44 countries around the world and checked whether this money provides at least a minimum quality of life.

We took into account state pensions, i.e. universal and regular benefits for people of retirement age, the so-called first pillar.

In a number of countries, pensions are neither taxable nor contributory. In some countries, the pension is an income on which you have to pay tax. There are also countries where a health insurance contribution is also collected on the pension. To make the comparison fair, the net amounts were taken into account, i.e. the money that the pensioner actually receives on his account or in cash.

Of the 44 countries considered, the people living in Norway receive the highest pensions—€1,797 per month according to the latest official statistics. Switzerland (€1,704) and the USA (€1,482) are also distinguished by the high state pension.

In the United Kingdom, according to the latest data from the Department for Work & Pensions, 8.4 million people receive pensions, and the average pension is £931.67 net or €1114 (9th place in the ranking).

Retirees in Albania (€128), Moldova (€128) and Ukraine (€110) receive very low amounts.

Retiree’s food basket

For the purpose of this study, we created a conventional food basket and confronted the prices of these products with the average pension. The basket consists of 10 groups of products: bread, milk, yoghurt, eggs, rice, cheese, meat, fish, fruit and vegetables. This list is WHO and local health ministry recommendations for the nutrition of older people. Although the list is very limited, these products, in the amounts given, are sufficient to meet the minimum monthly nutrient requirements of the average elderly person.

• Bread (12 loaves 500 g each) – £11.76
• Rice (3 kg) – £3.90
• Eggs (20 pcs.) – £3.25
• Milk (12 l) – £11.04
• Yoghurt (5 l) – £6.00
• Cheese (1.5 kg) – £8.42
• Poultry and beef (3 kg) – £13.63
• Fish (3 kg) – £43.26
• Fruits (9 kg) – £13.89
• Vegetables(15 kg) – £19.24

The value of the basket of basic food products in April 2022 is £134.39 (€471.80). Thus, staple food ensuring only survival is the equivalent of 14.4% of the average British pension.

Where can you live off a state pension

Although food preferences and perceptions of a comfortable life vary from region to region and even per person, we decided to compare the prices of basic food products with the average pensions in different countries.

The best ratio of food prices to pensions was recorded in Norway, Austria and France. In these countries, the basic basket of products accounts for 13.4%, 13.7% and 14.3% of the average pension, respectively.

In this ranking, the United Kingdom was 4th out of 44 countries with a result of 14.4%, ahead of such countries as Australia (15.3% and 7th place), Ireland (15.8% and 8th place) and the USA (16.1% and 10th place).

Among the countries included in this study, the situation of retirees in Albania, Belarus and Ukraine is the worst. The basket of basic products alone consumes 72.8%, 76.7% and 84.9% of the pension, respectively.

With how expensive life on state pension can become, it is a good idea to look for savings. With Picodi you can shop in stores such as Aldi, Iceland, ASDA Groceries, Lidl and Sainsbury’s and get some of the money spent on shopping back. All you need to do is sign up to Picodi.com and activate cashback before the purchase.

Methodological notes

In this study, we compared the latest available official statistics on average state pensions, i.e. the first pension pillar. The amounts represent the monthly net pensions and come from official websites of governments, ministries or social security companies, with compulsory deductions, if any. In countries where the relevant authorities use weekly rates, we multiplied the amounts by 52 (the number of complete weeks in a year) and divided them by 12.

The set of products used in the study is a conventional food basket, created only for statistical purposes. The amounts given were calculated on the basis of the recommendations of the WHO and some health ministries on the minimum standards of food consumption for the elderly. The prices of the contractual basket products come from the numbeo.com portal, where consumers from all over the world monitor the prices of food and other products and services.

We converted the local currencies using the average Google Finance exchange rate for the first quarter of 2022.

The list of official sources is available at this link.

Public Use

The infographics and statistical data presented in the report can be freely used for both commercial and non-commercial purposes, indicating the author of the study (Picodi.com) with a link to this subpage. If you have any questions, please contact us: research@picodi.com.