How much do you need for comfortable existence in retirement.

[SexyGreyFox]

Retire, I just hope I won't die at my desk. I've seen too many people die before their time recently (non COVID related) I hope I don't share their fate.

When the factory I worked at closed down somebody setup a Facebook page called "Creda Gone But Not Forgotten RIP" and all it's used for is to announce deaths of which the majority have just retired.
I'm at a funeral tomorrow and one next week.

 

[Deleted member 651465]

After tax I get around £1000 a month and when I retire I'll get way more than that.

Ah the joys of a final salary pension in an employer with a ridiculous pension contribution.

I've seen countless morons go for a promotion in the last 3 years just to guarantee themselves £35k / £40k final salary. The kick in the teeth is that exact same person starting in the exact same role today gets bent over with defined contribution pension because "reasons".

 

[DanTheMan]

Ah the joys of a final salary pension in an employer with a ridiculous pension contribution.

I've seen countless morons go for a promotion in the last 3 years just to guarantee themselves £35k / £40k final salary. The kick in the teeth is that exact same person starting in the exact same role today gets bent over with defined contribution pension because "reasons".

I was having this discussion with my father in law the other day as I also worry about what sort of pension I'll end up with. I'm currently in one of the few defined benefit pensions left (civil service) so theoretically I should be fine,hoqever even that isn't a given anymore.

One thing that we overlook is that it's a really tiny period in history that people have had the opportunity to retire with mega pensions in the UK.

 

[Calpol]

This whole subject matter is sadly neglected in our current education settings. I think many of us don't fully understand how pensions work or even what happens to our cash every month. I'm trying to educate my teenage children so they don't make the same mistakes I made. I have a deferred DB pension which will be available at 65 and then state pension at 67. By that point provided I'm
a) still alive
b) still married
I think we will be ok as our aggregated income will be c £4k a month. However the problem I have is that it's about 10 years too late and ideally I'd like to retire much earlier. Therefore my challenge is to bridge a gap between say 56 and 65. For me there is a gap in the market for fortunate/careful people where they can retire early but still have enough liquidity to enjoy key years, help set up their children if they have them. I can't see how I will need £4k a month at say age 80 but I'd love to have it at 58 with the time to enjoy it.
Too many of my mates have no plan or they think they will inherit enough to pay their debts and then they will liquidate their assets to live.

Anyway a more immediate issue is that I've just jacked in a well paying but misery inducing job so my early retirement plans are on hold!

 

[bainbridge]

I'm screwed. I've always paid the minimum amount towards my pension and am now 45 with 20 years left on a mortgage.

I just hope that when I'm old and skint, I have enough marbles left to remember what I squandered my money on!

 

[LabR@t]

The trick is to have a misspent youth to recall with glee, sex drugs and rock and roll. Then assiduously acquire some wealth and look after your health during mid life. Arriving at retirement with enough put by for a little fun again.
Retirement is similar to teens and twenties with less sex, more drugs and still some rock and roll.

best post ever

 

[Changesx]

I had an important talk with my company recently in relation to how important a pension actually is. I learnt that you can take out I think the first 25% out of your pension as tax free. Also learnt that your pension money increases in line with inflation. I was always putting in the minimum just because I thought state pension would cover me but then I realised I definitely wanna retire before the age of 65. I’ve always learned to live off little, but I know at some point when I have my own mortgage that my expenses will sky rocket and I’m regretting not putting more into my pension pot at a young age..

I wish they would have taught this kind of stuff at school. I’d have rather a lesson on how to be a responsible adult than find out about the Weimar Republic lol

 

[robj20]

Off the back of this thread and making me think about it, I've started another private pension with Vanguard, possibly consolidate an old workplace one into it as well.
Checked my government one as well to make sure its fully paid and it is. It takes a load of when you realise a private pension is a top up it doesn't fully have to cover everything.

 

[Mickie]

My pension age is 68, I'll be surprised if I live that long.

 

[robj20]

My pension age is 68, I'll be surprised if I live that long.

Same. 68, my dad retired at 55 and has had the time of his life, now 70 and can't do half the things he wants to due to health.

 

[Mysterae_]

This thread is certainly food for thought.

I'm 48 at the moment and have been paying in to a pension since I turned 18. I'd like to retire as soon as possible but realistically it won't be until I'm 60.

What's the best way to take stock of your pension, see the options etc? I think some research is due!

 

[Uther]

If people are young enough putting money away to bridge the gap from mid 50's to state pension age would be my advice. As above, late 60's is far to late, especially in a manual job.

 

[Uther]

This thread is certainly food for thought.

I'm 48 at the moment and have been paying in to a pension since I turned 18. I'd like to retire as soon as possible but realistically it won't be until I'm 60.

What's the best way to take stock of your pension, see the options etc? I think some research is due!

Have a look and see what costs you are paying. If you've had it for 30 years it's quite possible that you might be better off transferring it.
Obviously depends what type of pension it is of course...

 

[Demon]

Chatting to my advisor was a little sobering, he recommended that a private pension (not Gov one) would ned to pay out a minimum of £10k a year for someone with no debts/mortgages etc to be "OK", not comfortable, just OK which would give you around £19k a year (Gov + £10k private pension) which also doesn't include things like inflation, holidays or big items like "new" cars, house repairs etc.

That works out very close to the OP's £1500 a month.

It also means that you'd need about a £250k pension pot if you followed that plan for most people - £10k x 25 years (to age 90).

My pension advisor in work echod' that, we had a sobering conversation, in reality you want around £450-£500K (in todays money) as a pot to be comfortable (assuming no mortgage), I might be able to do that, but will require some luck in being able to maintain my current salary until retirement.. Many people struggle, they have to move jobs for normal reasons and as you get older, your chances of employment can diminish somewhat.. I have lots of people I know struggling and have had to take pay cuts which impacts their pension pot..

 

[robj20]

Seems high that I've managed give with less than that at my age.
I'm guessing that's for a single person. Is imagine for a couple you need a lot less.

 

[CuriousTomCat]

I didn't bother with a pension. I upgrade to a bigger house every 8 years on average. Then when I'm 66 I'll downsize to a really small house and the cash left over will be my pension. Or is an actual pension more profitable than property?

 

[dave28]

My pension advisor in work echod' that, we had a sobering conversation, in reality you want around £450-£500K (in todays money) as a pot to be comfortable (assuming no mortgage), I might be able to do that, but will require some luck in being able to maintain my current salary until retirement.. Many people struggle, they have to move jobs for normal reasons and as you get older, your chances of employment can diminish somewhat.. I have lots of people I know struggling and have had to take pay cuts which impacts their pension pot..

Nobody i know has half a million spare in a pot at retirement age and own their home outright. Who has that, a brain surgeon maybe or a lawyer.
Certainly not anyone with a regular job, not a cats chance in hell

 

[wonko]

I've never used it, but Pension Wise is a free service that offers impartial guidance on pensions.

I can't help the OP with what would be comfortable - as others have said it depends so much on what you're used to and happy with. All I can suggest is examining what you've spent over the last few years and start from there. The intermittent big-ticket items like holidays, replacing cars, house repairs, furniture (etc.) are easily forgotten and can be pretty significant.

In my case, I'm 56 and have been on a sabbatical for the last year due to circumstances I won't go into. Fortunately I started putting money into pensions early so am in a better position than most, and I'd been thinking about when to retire for a while and asking the same 'how much is enough?' question. So the sabbatical has been a good unplanned 'taster' for retirement.
A few things I've found so far:
- I'm spending less than I was while working, although covid has been a factor
- it's surprisingly hard to get out of the 'saving for retirement' mentality and feel entirely comfortable taking money out of savings and investments instead of putting it in
- I miss the company of work colleagues and enjoyment / satisfaction of the work itself
- I'm happier, less stressed, am healthier and fitter than I've ever been and have loads more time for hobbies (I've not been bored yet)
- if I do fully retire and circumstances change (boredom, money disaster) there would be nothing stopping me from working part-time or full-time again (although starting to draw from pensions affects what tax relief you can get on further contributions)

Overall, if you can afford it then I'd suggest thinking hard about retiring earlier - you never know what might be around the corner health-wise and it's possibly not an irreversible decision if it doesn't work out as planned.

 

[Belly]

I'm sitting pretty at the moment. Military Pension just over 1k a month, NRPS (Mil Pension) £350 a month, CSP £240, State Pension £640 a month, Wife's NHS pension £750, Reduced State Pension (lived abroad, so 5 years short of full pension) £590. £1,039,000.oo in the Bank, £175k in Stocks and shares ISAs, Intrest on savings over £15 a year but decreasing, £220 winter fuel allowance. No children, no mortgage BUT since the pandemic, Nowhere to spend it, discounting Sky and BT Sports and a few bottles of Chivas Regal. I don't want to move house - better the devil you know. If the wife passes away and I'm still in good health I hope to join the Chelsea Pensions in London....... Twickenham, Stamford Bridge, Lords, The Oval free of charge, although I'd have to give up my Military Pension.

 

[dodg3rman]

Nobody i know has half a million spare in a pot at retirement age and own their home outright. Who has that, a brain surgeon maybe or a lawyer.
Certainly not anyone with a regular job, not a cats chance in hell

Well now you do know at least one person and my job history is never more than average wage