Pension?

[Minusorange]

Well if you don't have one your life will suck, so yes it's worth it.

I don't mean have zero investments, other options like property, shares, crypto, antiques & collectibles as well as state pension seem more desirable to me at least vs state pension + private pensions, life will probably suck at whatever pension age is in 30 years combined with combined climate change and whatever other issues there are in the country anyway so it's probably better to be dead by then

 

[OldKitMan]

I'm down to 4 pension pots now as I moved some over to Vanguard. I've currently got a DB one which is going to

The Pensions and Lifetime Savings Association say "comfortable retirement" for a single person household needs an annual income of £43,900. That means with a 4% drawdown I'd need £1.1 million in my pension pot.

Who has £1.1 million saved!!

Surely that can't be right, have I messed up somewhere?

don't underestimate the value of starting early and compounding.

 

[Foghorn Leghorn]

Expectations clearly vary significantly from person to person, but according to UK Pensions, "Comfortable" spending for a retired couple is just over £5k a month.

That's a hilarious figure, and far more then I've ever earned per month during my working life, and I'd consider myself quite comfortable.

 

[darkgen]

You're forgetting that you get £12k from state pension, so you only need to top up with £31k.

Assuming the state pension exists in its current guise and won't be means tested in the coming decade or so!

 

[adam cool dude]

Obviously paying into a pension and I'll get a full state pension in 24yrs when I retire.

Pigs might fly. In 24 years time state pension will not exist or if you have a big enough private one you will not get it.

Why do you think government made it mandatory to start paying into a pension ten years ago.

 

[EvilRob]

That's a hilarious figure, and far more then I've ever earned per month during my working life, and I'd consider myself quite comfortable.

That's the figure for a couple.
But yeah, obviously comfort will mean different things to different people.

 

[EvilRob]

Why do you think government made it mandatory to start paying into a pension ten years ago.

Primarily because most people are on a DC scheme now and the majority of people weren't doing any significant retirement planning.

 

[Mr Badger]

The Pensions and Lifetime Savings Association say "comfortable retirement" for a single person household needs an annual income of £43,900. That means with a 4% drawdown I'd need £1.1 million in my pension pot.

Who has £1.1 million saved!!

Surely that can't be right, have I messed up somewhere?

Yes, you've messed up by not putting enough money in your pension!

Also this:

You're forgetting that you get £12k from state pension, so you only need to top up with £31k.

The main thing is to have a realistic view of what age you are going to retire and what your outgoings will be. Obviously that could be radically different if you own your home and are debt and mortgage free, compared to someone renting or still with years left to pay on their mortgage. If you want to retire at 60 you will need a much bigger pension pot now, than if you are planning to retire at (say) 68 when your investments will have had another 8 years to grow, you will hopefully be receiving the state pension and (to be blunt) you have less years left to live so won't need as much money.

 

[throwaway4372]

I don't mean have zero investments, other options like property, shares, crypto, antiques & collectibles as well as state pension seem more desirable to me at least vs state pension + private pensions, life will probably suck at whatever pension age is in 30 years combined with combined climate change and whatever other issues there are in the country anyway so it's probably better to be dead by then

I see, well the private pension age is ~10 years earlier than state pension age, I doubt that'll change even if they both rise, but ofc can't predict the future and if that changed then people would join your way of thinking pretty quick.
Tax is a big factor, which also might change, but more ppl are finding themselves in the 40% bracket, and saving 40% by increased salary sacrifice pension contributions is hard to beat.
Boomers liked property, and everyone hates them for hogging all the property, so at your own risk.
Antiques etc you're still paying capital gains tax, which may change, and is predicted to change. The decent items are too expensive for most ppl tho.
Crypto, don't get me started, every annual bitcoin price prediction thread I predict zero, eventually I'll be right.

 

[darkgen]

I see, well the private pension age is ~10 years earlier than state pension age, I doubt that'll change even if they both rise, but ofc can't predict the future and if that changed then people would join your way of thinking pretty quick.

Yep. SIPP will jump to 57 to align with the state as it increases to 67 in 2028. No reason to think that won't will continue to track alongside the state, which will be gawd knows what when I hit it in the next decade and a bit.

 

[helpimcrap]

Pigs might fly. In 24 years time state pension will not exist or if you have a big enough private one you will not get it.

Why do you think government made it mandatory to start paying into a pension ten years ago.

So what I pay into a private pension will mean the state pension is taken off it?

Eg £18k per annum private pension - £12k state pension = £18k p/a real pension?

I wouldn't get 18k + 12k = 30k?

 

[Begbie]

So what I pay into a private pension will mean the state pension is taken off it?

Eg £18k per annum private pension - £12k state pension = £18k p/a real pension?

I wouldn't get 18k + 12k = 30k?

Well their assuming, not stating facts. Who knows what will happen, but its a big reason I pay a substantial amount into a pension.

 

[Nutty667]

I see loads of people saying state pension won't exist in 20/30 years time.

HMRC have written to me several times over the years saying I am due full state pension, so I think there will be riots if it's suddenly taken away, or severely means tested against private contribution. I just don't think it's politically feasible to take it away.

Abolishing the triple lock will probably happen, and another increase in pension age also.

 

[throwaway4372]

If they yanked the pension everyone would stop working. Hand forced.

In a world without state pension for all, the state pension becomes indistinguishable from unemployment benefit. They'd scrap the pension for all and put them on unemployment and push them into working.

 

[fez]

You need to look into what your different pensions are invested in because there are far too many that have basically devalued against inflation because they aren't doing anything with your money.

 

[darkgen]

I see loads of people saying state pension won't exist in 20/30 years time.

HMRC have written to me several times over the years saying I am due full state pension, so I think there will be riots if it's suddenly taken away, or severely means tested against private contribution. I just don't think it's politically feasible to take it away.

Abolishing the triple lock will probably happen, and another increase in pension age also.

Don't you believe it!

In it's current trajectory, It will become unaffordable in the next decade. Something is going to have to give; means testing seems the only viable option currently and perhaps the least egregious method.

 

[EvilRob]

Don't you believe it!

In it's current trajectory, It will become unaffordable in the next decade. Something is going to have to give; means testing seems the only viable option currently and perhaps the least egregious method.

AI will make it all better. We're knocking on the door of an age of plenty.

 

[darkgen]

AI will make it all better. We're knocking on the door of an age of plenty.

HAH! We live in incredible times and I'm thankful I'm on the downward swing in life. Christ knows what it all means for youngfolk. Nothing good that's for sure.

 

[Terminal_Boy]

I never planned on the state pension existing when I reached 65 and this might be the only smart thing my 20 year old self ever did.

As things stand, I’m getting nothing from HMG until I’m 74 and I fully expect it to be means tested in which case I’ll be lucky to get 25% of it.

 

[Mr Badger]

I see loads of people saying state pension won't exist in 20/30 years time.

HMRC have written to me several times over the years saying I am due full state pension, so I think there will be riots if it's suddenly taken away, or severely means tested against private contribution. I just don't think it's politically feasible to take it away.

Abolishing the triple lock will probably happen, and another increase in pension age also.

Don't you believe it!

In it's current trajectory, It will become unaffordable in the next decade. Something is going to have to give; means testing seems the only viable option currently and perhaps the least egregious method.

There is already a problem in the UK with a lot of people not saving enough for their retirement and the government has taken steps such as introducing auto enrolment into company pension schemes to push people to improve their private pension provision. Introducing means testing of the state pension will only make that situation worse. Why save for your retirement if the government is going to punish you by taking away your state pension? Also financial expectations have been set, particularly for those that have already built up an entitlement to the state pension, but may still be many years away from claiming it.

There's a whole other debate about the impact of AI/technology on jobs and the long term need to move to a Universal Basic Income. But sticking to pensions I really can't see a UK government introducing means testing, unless they completely take leave of their senses. Or at least set it at such a high level that it only impacts on the genuinely rich, rather than working class people who have been prudent in planning for their retirement.

Steps that seem more likely:

• Weakening the triple lock
• Further increases in the state pension age
• Increasing the amount of qualifying years needed (it previously changed from 30 to 35 years and I can imagine a future change to 40 years contributions being required for a full state pension)
• Additional taxation to claw back more money from better off pensioners