Pensions

[Gareth Barry Conlon]

Curious to see how others are getting on with their pension pots.

I'm approaching 50 so retirement is starting to appear on the horizon. I've got various pension pots from different jobs I've had. Current total circa: £380k. As this is only around 8x my current salary I always thought it insufficient. However with compounding returns and 5~10 years to keep paying in I should be OK. And having done some digging I'm better off than most.

I know there are a few foc boomers on here many no doubt living it up on a defined benefit pension. But as a generation x'er there is going to be huge disparity with people's finances as my generation gets old.

 

[hampshireblue]

I think there's already a specific thread for this. FWIW, make sure you're well diversified, keep charges as low as possible, consider using an IFA even on an hourly basis to ensure the balance of investments is right for you. Plough as much in as you can afford to take advantage of the tax relief and the sooner the better. Try to rationalise those pots into one to keep the fees down.

 

[Gareth Barry Conlon]

I think there's already a specific thread for this.

No. There is one about the state pension and that has a lot of scroungers vs tax the rich type arguments.

I'm just curious to see what people's private pension pots are like and what plans they have.

 

[RobMCFC]

Curious to see how others are getting on with their pension pots.

I'm approaching 50 so retirement is starting to appear on the horizon. I've got various pension pots from different jobs I've had. Current total circa: £380k. As this is only around 8x my current salary I always thought it insufficient. However with compounding returns and 5~10 years to keep paying in I should be OK. And having done some digging I'm better off than most.

I know there are a few foc boomers on here many no doubt living it up on a defined benefit pension. But as a generation x'er there is going to be huge disparity with people's finances as my generation gets old.

You're in a much better position than me although I am on course for where I want to be.

57 years old with £250K in the pot. Although I do have a very old Ferranti pension that is a defined benefit kind of thing that will probably pay another £2K a year.

I think that when the time comes, I'll probably drop down to 4 days a week and then 3.

The maths of immediate retirement don't work for me. As I said on the holiday thread, I'm kind of living a retirement lifestyle now with holidays every few weeks and working from home 3 or 4 days a week. I don't want to retire but not have enough money to do things, so I'm doing them now whilst I'm relatively young and can afford them.

 

[Gareth Barry Conlon]

You're in a much better position than me although I am on course for where I want to be.

57 years old with £250K in the pot. Although I do have a very old Ferranti pension that is a defined benefit kind of thing that will probably pay another £2K a year.

I think that when the time comes, I'll probably drop down to 4 days a week and then 3.

The maths of immediate retirement don't work for me. As I said on the holiday thread, I'm kind of living a retirement lifestyle now with holidays every few weeks and working from home 3 or 4 days a week. I don't want to retire but not have enough money to do things, so I'm doing them now whilst I'm relatively young and can afford them.

That £2k a year, guaranteed for life and will go up with inflation is worth around £50k. And you get that peace if mind that it's there for life.

I find it weird that with a defined contribution pot you basically plan to draw it all down and have nothing left at some point in your 80s.

 

[RobMCFC]

That £2k a year, guaranteed for life and will go up with inflation is worth around £50k. And you get that peace if mind that it's there for life.

I find it weird that with a defined contribution pot you basically plan to draw it all down and have nothing left at some point in your 80s.

Unfortunately, that's the way it is. Not like in my Dad's day where you got a defined pension amount for life. But there again, he had a much tougher upbringing in the 1930s than I did in the cushy 1970s :)

My plan is to draw relatively heavily in the first few years and then tail it off the older I get, figuring that I'll need less spending money in my 80s than I will in my 60s.

My first decision will be how long I take to spend one of my pension pots (roughly 40% of the total) in the period between whenever I drop my hours and getting the state pension.

And to be honest, if my wife and I make to our 80s, I consider it bonus time.

 

[dickie davies]

And to be honest, if my wife and I make to our 80s, I consider it bonus time

I'm like you (apart from being a bit older)
And my back of a fag packet calculations give me a draw down till my mid 80's
As a person whose mum passed at 60, Dad at 72 and the only grandparent I knew at 79, longevity isn't on my side

 

[Gareth Barry Conlon]

I'm like you (apart from being a bit older)
And my back of a fag packet calculations give me a draw down till my mid 80's
As a person whose mum passed at 60, Dad at 72 and the only grandparent I knew at 79, longevity isn't on my side

My back of fag packet calculation is based around 25 years. At that point I can sell the house if required but slowing down is what will most likely happen.

 

[RobMCFC]

Also having no plan of how to fund your life in your 70s, 80s and beyond is stupid.

However, it's a far greater crime thinking too much about it and not spending enough now to enjoy your time whilst you still can.

 

[mexico1970]

However, it's a far greater crime thinking too much about it and not spending enough now to enjoy your time whilst you still can.

The older I have gotten the less I need, that applies to most people surely? As you say if you don't enjoy life right here and now you may not be in a position health wise to enjoy it later.

 

[EL APACHE TEVEZ]

Pension I won’t be seeing that anytime soon,Mr Taxman is circulating like an hyena

 

[Gareth Barry Conlon]

Pension I won’t be seeing that anytime soon,Mr Taxman is circulating like an hyena

My pension payments (money going in right now) are the only thing that the tax man doesn't get his hands on.

As a higher rate tax payer every 100 input in saves 40 in tax. I will get taxed when I take it out but that's likely to be at a much lower rate.

 

[Kompany Car]

You dont want to ask things like this, just look at Reddit and you will see everything from people who have millions to people who have fuck all.

The best thing you can do is plan for yourself and not compare.

The planning tools on here are pretty good ...

https://www.2020financial.co.uk/pension-forecast-calculator/

If you go to the top there are also drawdown calculators.

An alternative site is this one which also allows you to look at sequence of returns risk.

https://www.portfoliovisualizer.com/monte-carlo-simulation#analysisResults

 

[Saddleworth2]

Unfortunately, that's the way it is. Not like in my Dad's day where you got a defined pension amount for life. But there again, he had a much tougher upbringing in the 1930s than I did in the cushy 1970s :)

My plan is to draw relatively heavily in the first few years and then tail it off the older I get, figuring that I'll need less spending money in my 80s than I will in my 60s.

My first decision will be how long I take to spend one of my pension pots (roughly 40% of the total) in the period between whenever I drop my hours and getting the state pension.

And to be honest, if my wife and I make to our 80s, I consider it bonus time.

I really don’t know how the younger generations, those between 20 and 40 will do the buying their own home and saving enough for a decent pension without working until they drop.

 

[Saddleworth2]

My pension payments (money going in right now) are the only thing that the tax man doesn't get his hands on.

As a higher rate tax payer every 100 input in saves 40 in tax. I will get taxed when I take it out but that's likely to be at a much lower rate.

The first 25% is tax free (or it used to be).

 

[Gareth Barry Conlon]

The first 25% is tax free (or it used to be).

Correct. Up to £268k or 25%. Whichever is lower.

 

[Gareth Barry Conlon]

The first 25% is tax free (or it used to be).

Correct. Up to £268k or 25%. Whichever is lower

I really don’t know how the younger generations, those between 20 and 40 will do the buying their own home and saving enough for a decent pension without working until they drop.

Yeah. I remember when the opt out rules came in. I worked with 2 girls in their 20s who immediately opted out. Both lived at home and would go on various holidays a year.

 

[mexico1970]

I really don’t know how the younger generations, those between 20 and 40 will do the buying their own home and saving enough for a decent pension without working until they drop.

Someone is buying these overpriced homes though, and the more people buy them then prices for homes will rise.

It's a conundrum for sure.

 

[Citizen of Legoland]

I really don’t know how the younger generations, those between 20 and 40 will do the buying their own home and saving enough for a decent pension without working until they drop.

This of course impacts their parents who had maybe factored in selling their home at some point to extend the lifetime of their pension pots or cover care home fees. The upshot is that more elderly people will be requiring government funded care homes as the funds are diverted to their children instead.

 

[Saddleworth2]

My pension payments (money going in right now) are the only thing that the tax man doesn't get his hands on.

As a higher rate tax payer every 100 input in saves 40 in tax. I will get taxed when I take it out but that's likely to be at a much lower rate.

The first 25% is tax free (or it used to be)