Scots spending £1.7m each over a lifetime

● Housing and utilities take up largest proportion – but plenty left to have fun

The typical Scottish household spends £1.7 million over the course of a lifetime, with housing and utilities costs accounting for the highest proportion of expenditure.

The report found that people under the age of 30 spend just one-fifth of their money on having fun, compared with almost a third on housing and energy bills. In contrast, those aged 65 to 74 spend a quarter of their total on having fun, according to a report entitled The Cost of Tomorrow from financial planning and investment management group Tilney.

Uk-wide, the lifetime spending figure is higher, at £1.9m, weighted by higher costs in London and the south-east of England, where expenditure reaches more than £2m.

The analysis of Office of National Statistics data found that the average adult will hit the £1m household spending milestone at the age of 50, and faces the prospect of £893,500 of spending in later life.

Meanwhile, the top quarter of households splash nearly £3m in total over their lifetimes.

Andy Cowan, head of financial planning at Tilney, said: “The sums we spend over our lifetimes when quantified in today’s prices seem mindbogglingly large, and yet they reflect the reality of life in Britain today.”

On average, a household will spend £26,500 every year between the ages of 65 and 75, and will need access to a posttax income of £14,100 over and above the combined state pension of £12,407 to sustain these spending levels, the report found.

Mr Cowan added: “While some of today’s retirees are in a position to enjoy recreation and achieve their desired lifestyle, those coming behind face significant pressures on retirement income and much greater uncertainty because of the demise of traditional, predictable final salary pensions, and must overcome a number of hurdles if they want to ensure they can live with financial security in their own retirement.”

The study found that by age 50, a third of the average £1m expenditure has gone on housing and utilities, £45,000 on clothing and shoes, and £89,000 on food, these essentials adding up to about 45 per cent of all spending. Holidays, restaurants and entertainment have made up £203,000, or one-fifth of the total.

As housing costs consume a smaller and smaller portion of the budget, people are able to enjoy their money more, the study found.

From the age of 65, a typical household can expect to spend £99,500 on having fun, of which £41,000 is on holidays – with more than half of that spent on foreign travel. By comparison, keeping a roof over their heads will cost only a little more than their leisure pursuits.

Overall, an average household will spend £420,000 over the course of their retirement in today’s prices.

Spending tends to be frontloaded, the report revealed, averaging £26,500 in the first few years, before dropping to a little below £16,000 after the age of 75, when it said that people are more likely to live alone and be less active.