Financial Planning for Retirement - where are you?
- Thread starter trentlad
- Start date
Soldato
was this email from the government by chance? Who have an invested interest in people saving as much as possible.
Its all **** anyway you look at it, the landscape will have considerably changed by the time I retire and im absolutely guaranteed to get royally screwed over no matter how much I save now.
Save a little sure, but live your life when your young because when your old and frail, and the retirement age will be post 70yrs - massive amounts of cash really wont matter.
Its all **** anyway you look at it, the landscape will have considerably changed by the time I retire and im absolutely guaranteed to get royally screwed over no matter how much I save now.
Save a little sure, but live your life when your young because when your old and frail, and the retirement age will be post 70yrs - massive amounts of cash really wont matter.
Soldato
£16k per annum? Surely that's pretty good?
You won't (I would guess) have a mortgage to pay by then - which would account for a pre-tax salary of about £12,000 on top (assuming ~£600/month mortgage) - so equivalent to a working salary of £28k. If I didn't have kids (and you won't when you're retired), that would be plenty to live on.
You get an extra few hundred quid a month when the state pension kicks in too.
Associate
Im 35 and on track. Not so sure I will be by the time im 45 though lol
The value of money is a subjective thing, comparing absolutes like this doesnt work as everyone has a very different personal valuation of a pound.
Ie, £28k in your example is a lot to some, but impossibly small to others. I'd bet panthro falls into the latter camp.
Well my wife doesn't have a pension as such (except state and a terrible employers pension she's had for a year) and when we have children we plan on her staying at home and looking after them for the first few years at least. So I will in effect be supporting her both pre and post retirement, so it's still not great. I plan to supplement my pension in other areas i.e. property.
Well at the minute I have about 30% of my salary saved at age 21. Although that will drop in 2016 as my salary will nearly triple at the end of my apprenticeship. Hoping to be able to retire around 50.
I currently pay 6% into a work pension and they add a further 10%.
I currently pay 6% into a work pension and they add a further 10%.
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I think the hardest bit is that many people have inheritance/windfalls whilst others get none.
Many of my friends at school and college had huge lump sums left from relatives which served as a deposit for a house, pay all Uni fees and even then their first car. Meanwhile I didn't have anything like that so amassed huge debt.
My relatives are relatively poor and made very bad life choices - my grandad remarried after my grandma died, and he sold his house. He then used all £175k of his house to do up his new wife's house which he has agreed he has no stake in, and the full amount goes to his wife's original kids.
My other grandad moved house when my nan died and signed the new house over to my mum (for 1p, or something?) however it is a nice apartment, but the lease on the land was something ridiculous like 100yrs, so it is decaying in value pretty fast.
My parents are amazing people, but they also lived to the edge of their means to try and provide the best for the family. They have very little to their name in terms of savings, but they do have a pretty nice house in a decent area which is increasing in value which has improved their quality of life no end.
I've got nothing to my name, save possessions (disposable, non-property) and finance, but I have been paying into a pension (Local Gov) for around 5yrs at around 18% for 2.5yrs and 24% for 2.5yrs.
Many of my friends at school and college had huge lump sums left from relatives which served as a deposit for a house, pay all Uni fees and even then their first car. Meanwhile I didn't have anything like that so amassed huge debt.
My relatives are relatively poor and made very bad life choices - my grandad remarried after my grandma died, and he sold his house. He then used all £175k of his house to do up his new wife's house which he has agreed he has no stake in, and the full amount goes to his wife's original kids.
My other grandad moved house when my nan died and signed the new house over to my mum (for 1p, or something?) however it is a nice apartment, but the lease on the land was something ridiculous like 100yrs, so it is decaying in value pretty fast.
My parents are amazing people, but they also lived to the edge of their means to try and provide the best for the family. They have very little to their name in terms of savings, but they do have a pretty nice house in a decent area which is increasing in value which has improved their quality of life no end.
I've got nothing to my name, save possessions (disposable, non-property) and finance, but I have been paying into a pension (Local Gov) for around 5yrs at around 18% for 2.5yrs and 24% for 2.5yrs.
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Caporegime
We have a pot of money if one of us were to die/emergency fund. The much more important goal is to get our now 17 year mortgage paid within 8 - 10 years. The interest saving is both hilarious and mortifying.
Soldato
I have a final salary scheme which pays me 11k per annum (paid in for 26 years at 6%). I am still working full time (62 years old) therefore I pay 40% tax on it.
My other pension pot is at about 40k now and aiming to have it at 60k on retirement. This I will drawdown at about 5k per annum. So about 16k plus state pension is my projected retirement income.
My other pension pot is at about 40k now and aiming to have it at 60k on retirement. This I will drawdown at about 5k per annum. So about 16k plus state pension is my projected retirement income.
Man of Honour
I think that schedule isn't too inaccurate if you have been sensible and got yourself a pension saving started. However I plan on using property and my foreign investments as my main source of retirement, but I do have a private final salary pension scheme which is rather good which I hope to keep contributing to for as long as I can.
Soldato
If I include everything I'm almost 10 years ahead. 
e: though I did include money I'm likely to spend before I retire but even without those I'm 6-7 years ahead
e: though I did include money I'm likely to spend before I retire but even without those I'm 6-7 years ahead
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Soldato
I dont think expecting to double your investments every five years is unreasonable especially when you take compund growth into consideration ~15% a year.
We are no where near that scale though, mainly because our salaries have jumped dramatically over the past 5 years. At our age we would need about £700k in assets
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Associate
I have a deferred final salary pension that I paid into for 17 years.
I am now in a defined benefits pension that will see me through to retirement.
I aim to just go to part time work at 55-57 and take my pensions.
I am now in a defined benefits pension that will see me through to retirement.
I aim to just go to part time work at 55-57 and take my pensions.
Associate
31 years old, current prensiond is about 85% of my current wage.
So not doing to bad by that measure, currently contribute 15% of my wages plus 6% employer contribution.
So not doing to bad by that measure, currently contribute 15% of my wages plus 6% employer contribution.
Caporegime
Probably won't live long enough to see retirement (heart disease and cancer is rife in my family) I'd rather spend my money when I can really enjoy it than save a massive amount to sit on my **** being a grumpy owld ****
Does this include all financial assets such as savings, ISAs, pensions, stocks, equity in houses and property?
IF so I am well on track, if it is savings sat in an account somewhere then I'm at about half net salary.
I think that is when this schedule breaks down, as you get older there is a good chance that you end up in a position commanding a significant salary so 6x your 100K salary when you are 50 is not realistic.
I think a more realistic way is to think what annual salary would you want now to live on if you retire. You want to have something like 1.5X that amount for every year you expect to live. So if you want early retirement at 50 then you will need a heck of a lot more saved up.
What most retirement plans seem to do is assume you will want to earn something like 1/3rd of your final salary when you retire, because people sued to higher salaries will expect more in retirement and have higher living costs. I don;t think that is true at all. Someone might earn a high salary from their 50s onwards but be perfectly happy to drop down to 12k a year when retired, especially if they know they dont have much outgoing expenses like mortgage. 12K a year might only be 1/10 of their salary. Someone earning 20K a year when the retire will want something at least 10-12K so 50-60% of their final salary which is far harder to achieve.