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Your Pension.

I pay 6% work pays 9% been paying in since I was 24 now 38, also plan to sell house and move to smaller property and get a part time job to supplement when I retire.
 
I pay 5.3% apparently, Not sure what company pays (NHS)

I am low waged though so it will be a low amount once i retire. I am concentrating on getting a better job first.Then will look into pension stuff more, just cannot afford to save more at the moment.
 
Having previously worked in the pensions industry for years, it's shocking how much you actually need to have put away to have a decent pension when you retire. Talking personal pensions here, not any government pension (if there is one by the time I/we retire!).

Say you want 20k a year (bear in mind 20k now will be worth less than that in 20/30 years time), if you retire at 60, that's probably 20 years of annuity/yearly income it will need to provide. That's £400,000 you'll be needing. That's not taking a 25% tax free lump sum. And then you'll pay income tax on the yearly income. So that 20k a year, after inflation and income tax is more like £10k a year, luckily the state pension will be anough to get your total pension back up to £17-18k a year.

So bet on half a million in a pension pot to be sure. Yeah, I'll be working until I'm dead/renting out property just like many other people my age when they come to 'retire'.
 
Make said:
My previous employer told me they'll contribute a maximum of 1%, regardless of what I contribute, and I'd have to match it as well, so that'd be less than 20 pounds a month combined.

I told them to stuff it.

The worst thing about pensions is the fact that you don't get the "money" as such, you have to either buy an annuity or go into that "drawdown". Unless you live to the projected age, you will lose money. Or pay extra so that your spouse or whatever gets it.

If you have your own ISA/savings, you use your money the way you want, and no-one can touch it even if you die.
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If you're a smoker/have health problems, you'll get more per year that a 100% fit and healthy person.

Annuities have to pay out until you die, if they aren't set to pay out to a spouse after death. Yes, if you die before the annuity providers estimate, you'll get less. But consider that the annuity provider is probably basing someone aged 60 on living another 20 years, until 80ish. What happens if you live to 100? You still get the annuity, year after year. You then make money. For every annuity that the providers make money on, there'll be one they lose money on.

The good thing about an annuity is that it is a guaranteed* amount you'll receive for the rest of your life, no matter if you live until 120.

*obviously nothing is guaranteed in this world, past performance is not an indication of future results etc etc :D however annuities I believe would be covered under FSCS (90%) is the provider went under.
 
TallPaul_S said:
If you're a smoker/have health problems, you'll get more per year that a 100% fit and healthy person.

Annuities have to pay out until you die, if they aren't set to pay out to a spouse after death. Yes, if you die before the annuity providers estimate, you'll get less. But consider that the annuity provider is probably basing someone aged 60 on living another 20 years, until 80ish. What happens if you live to 100? You still get the annuity, year after year. You then make money. For every annuity that the providers make money on, there'll be one they lose money on.

The good thing about an annuity is that it is a guaranteed* amount you'll receive for the rest of your life, no matter if you live until 120.

*obviously nothing is guaranteed in this world, past performance is not an indication of future results etc etc :D however annuities I believe would be covered under FSCS (90%) is the provider went under.
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I know, annuities used to be good for people born in the 50's, 60's etc. Baby boomers.. as they had their life expectancy "extended" from the usual 70's to near 85's. Annuities didn't catch up in time, so they have good ones.

But when we youngsters retire, the annuity rates will be where they are now; crumbled, because our life expectancy probably won't go any higher without major medical advances. We will be working longer as well. Interest rates are also bad at the moment, so your annuity rate will entirely depend on the current economic climate. You save for 50 years, but your return is determined by the situation in one year.

We are screw'd unfortunately.
 
I'm already retired with investments (stocks/shares/land rental) returning approx £15k per year and growing at 4.5% a year currently. I also have a final salary scheme that has 15 years of contribution in it atm and is currently valued at £5k per year and will track with inflation - ages until I can tap that though (I'm currently 35). The profits from my investments are obviously still paying NI which contributes to my state pension.
 
Make said:
I know, annuities used to be good for people born in the 50's, 60's etc. Baby boomers.. as they had their life expectancy "extended" from the usual 70's to near 85's. Annuities didn't catch up in time, so they have good ones.

But when we youngsters retire, the annuity rates will be where they are now; crumbled, because our life expectancy probably won't go any higher without major medical advances. We will be working longer as well. Interest rates are also bad at the moment, so your annuity rate will entirely depend on the current economic climate. You save for 50 years, but your return is determined by the situation in one year.

We are screw'd unfortunately.
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Start smoking 10 years before you retire, and add heavy drinking on top of that, and you'll probably get around 20-30% (possibly more) extra for your annuity. You can stop smoking right after buying the annuity and it won't change. :D
 
amigafan2003 said:
I'm already retired with investments (stocks/shares/land rental) returning approx £15k per year and growing at 4.5% a year currently. I also have a final salary scheme that has 15 years of contribution in it atm and is currently valued at £5k per year and will track with inflation - ages until I can tap that though (I'm currently 35). The profits from my investments are obviously still paying NI which contributes to my state pension.
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Some people just make you sick.... :p

Retired at 35, that's just 3 years older than me. Well done, gotta hand it to you :)

I presume you must have no mortgage/rent to live on 15k a year too. Lucky barsteward!
 
Columbo said:
Well it depends how good you are at saving as an example:

If you retire at 65 and live to 81 (life expectancy of the UK) to match that you'll need to have £50400 in savings if you don't have a separate pension, to get that level you'd need to save (and never touch) £140 per month from now until retirement.

That does not take into account any interest gained from savings nor does it account for any inflationary decrease to the value of money.

Including the state pension you would have an income of around £180 per week to live on out of which your food, energy + other bill must be taken. Does that sound like an amount that would be acceptable to you?

How much do you put in now compared to the above calculation?
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Its similar to what my pension contribution is tbh. At the moment I just cannot afford to put anymore into one. (New family). I suppose I'll be able to ramp up payments in the future . I could probably live on 180 a week. But I don't want old age to just be about surviving.
 
I've got a SIPP, which I put a lump sum into every year.
Also got a few company pensions hanging around that I need to transfer into my SIPP too, though they're not worth a huge amount.

I've been paying into a pension in some form since I could afford to, probably started around age 23/24 and I'm 33 now.
The last few years I've been putting some money into a stocks and shares ISA too, which should help top things up.

Hopefully I'll have enough not to be destitute when I retire, though when you look how much annuities pay at the moment it puts things into perspective!
 
Enrolled at 22 and now 30. I pay in the minimum I need to in order to get my employers' contribution which scales as follows:

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TallPaul_S said:
Some people just make you sick.... :p

Retired at 35, that's just 3 years older than me. Well done, gotta hand it to you :)

I presume you must have no mortgage/rent to live on 15k a year too. Lucky barsteward!
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Yup - mortgage at age 19 and poured everything into it and paid it off in 14 years - it was tough for the first 10 years until earnings caught up but it was worth it. Got lucky with a parcel of land gifted to me by a late uncle though that I now rent out through an agent to a family running a campsite business on it - that's the majority of my income. Other items are stock/shares and some ongoing license fees for some code packages and a few ITIL procedures I've created.

It's amazing how far £15k goes when there is no rent/mortgage/commuting costs to come out of it. And no childcare costs either as I'm at home to look after my three kids. Plus the wife works as a teacher and doesn't want to retire yet - enjoying it too much - she's only 31 though.
 
Yeah, got an NHS pension. I started in 2010 but missed a threshold earlier on in 2010, so I think it's 66ish before I can start drawing it, and of course the state pension goes up all the time. I'll be dead by then.
 
I think by the time I am on a pension, they will be scrapped (because the benefit scroungers will have used it all up!) so instead of paying any money into a government pension I would rather pay into a trust or just an offshore bank account where it can't be touched by the UK.
 
I've been paying into various pension funds since I left school.
Cinema Pension ?? If I paid into one over 2.5 years only evidence of that is my P60s, Never bothered to check.
Sainsburys - paid into theirs for 7 years & opted out of serps in the 80's, they do send me updates but I go 'meh' when they send me them.

I've been paying into a private scheme since late 1995 (Aviva now) & I've been increasing payments of late. I plan on retiring at 70 anyway (health permitting)
 
PeterNem said:
Enrolled at 22 and now 30. I pay in the minimum I need to in order to get my employers' contribution which scales as follows:

Screen%20Shot%202014-01-15%20at%2022.08.04.png
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So moronic that a company has to pay a contribution for its workers pension especially considering a tiny percentage will work there for many years!
 
86JR said:
I think by the time I am on a pension, they will be scrapped (because the benefit scroungers will have used it all up!) so instead of paying any money into a government pension I would rather pay into a trust or just an offshore bank account where it can't be touched by the UK.
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How do you plan to avoid paying national insurance contributions exactly?

So moronic that a company has to pay a contribution for its workers pension especially considering a tiny percentage will work there for many years!
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They don't have to do anything other than ensure the employee is contributing to some sort of pension. An employer making pension contributions to a private pension is just another benefit and completely discretionary. Something many companies are happy to offer as part of a total rewards package to make working there an attractive proposition.

Any more rubbish you want to post?
 
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