Pensions

[I'm With Stupid]

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.

Well at least if you work till you drop, you won't need the pension anyway.

 

[Kompany Car]

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.

It actually saves you more as you also dont pay NI on your contribution and most decent companies also give you their NI reduction on top.

 

[Blue Maverick]

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.

Well seen as their parents are the supposed chosen ones with loads of cash I’m guessing they’ll benefit from their deaths. There’s lots of talk about how all the youngsters can’t get on the ladder etc and I do feel for them but at the same time they are blaming boomers and Gen X for having all this cash and the houses, well unless their parents are morons or selfish I expect they’ll get a lot of that cash, maybe a bit later on in life as people are living longer, but as long as it doesn’t go in care home fees then quite a lot of kids will be inserting quite a bit of cash. We have one daughter she’s probably going to get the best part of £400k by the time we pop out clogs, hopefully not for a few years.

 

[Gareth Barry Conlon]

Well seen as their parents are the supposed chosen ones with loads of cash I’m guessing they’ll benefit from their deaths. There’s lots of talk about how all the youngsters can’t get on the ladder etc and I do feel for them but at the same time they are blaming boomers and Gen X for having all this cash and the houses, well unless their parents are morons or selfish I expect they’ll get a lot of that cash, maybe a bit later on in life as people are living longer, but as long as it doesn’t go in care home fees then quite a lot of kids will be inserting quite a bit of cash. We have one daughter she’s probably going to get the best part of £400k by the time we pop out clogs, hopefully not for a few years.

I have a friend who's a hair dresser. Self employed and never had a pension since starting work at 17. Their pension plan was basically inherit the family home.

This they have done as their parents passed away. 2 kids inheriting about 500k in assets. It's something but not really enough in my book. But then I also know self employed people with no pension and unlikely to inherit anything.

 

[mexico1970]

I have a friend who's a hair dresser. Self employed and never had a pension since starting work at 17. Their pension plan was basically inherit the family home.

This they have done as their parents passed away. 2 kids inheriting about 500k in assets. It's something but not really enough in my book. But then I also know self employed people with no pension and unlikely to inherit anything.

You can live on very little as you get older. For instance people on minimum wage might actually be better off on a pension than they were working.

 

[Kazzydeyna]

I’m going at 58-60. Should have no mortgage by then (hence unsure exactly what age I will be, 58 is best case), with a final salary pension of circa 14k p.a (inflation linked) and a tax feee pot of around £90k, 10k Pa (inflation linked) on top and a pension I shall draw down to zero between 58/60 and 67 which will pay me around 5k Pa until my state pension kicks in (about 10k Pa I think).
That’s a fair bit les per annum than am currently on bit my outgoings will be severely reduced so I’ll have more disposable money.

I could work until I’m 67 and be thousands a year better off but I want to enjoy a few years of good health without working so that’s me off in a few years.

I pity today’s youngsters tbh, they’ll have it a lot tougher than my generation.

 

[Mazzarelli's Swiss Cheese]

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.

I think that's the idea.

 

[hampshireblue]

I was in a very generous DB scheme and was expecting £50000 per annum index linked. After Brexit, CETV(transfer values) went through the roof. I had a tumour(fortunately all removed) but it persuaded me to retire at 55 and transfer the pension into a SIPP. The logic was we could effectively drawdown and amount to allow us to keep our lifestyle as if I was still working and the chances were we wouldn't need £80k + when we are in our 70s/80s. The first couple of years there's always a doubt that the amount will last. But after nearly 9 years of drawdown at around 4%, the SIPP still has 10% more than when I started. A good IFA has proved invaluable especially as he is a fellow Blue!!

 

[mikeyboy]

I have 5 company pensions totalling around £30k which apart from 1 are all frozen at the moment.
I'm maybe looking into combining them all with something like pensionbee or just with my current pension. I'm no expert so not 100% if this is worth it or not or better off just leave them be.

 

[Gareth Barry Conlon]

I was in a very generous DB scheme and was expecting £50000 per annum index linked. After Brexit, CETV(transfer values) went through the roof. I had a tumour(fortunately all removed) but it persuaded me to retire at 55 and transfer the pension into a SIPP. The logic was we could effectively drawdown and amount to allow us to keep our lifestyle as if I was still working and the chances were we wouldn't need £80k + when we are in our 70s/80s. The first couple of years there's always a doubt that the amount will last. But after nearly 9 years of drawdown at around 4%, the SIPP still has 10% more than when I started. A good IFA has proved invaluable especially as he is a fellow Blue!!

This is what I find interesting. When working and having kids at home we easily burn through over 80k pa of household income. So this makes a pot of several hundred k seem not enough.

But many people say its fine. You spend less.

 

[Bluechipblue]

Mine's doing just ok I reckon. Although I'm quite happy with it how it stands. I've had a private pension since transferring it from a company pension 35 years ago. Just over a year ago, my IFA retired and recommended another company to take it over. Since then they have just let it ride. Just recently, the advisor assigned to me has suggested moving it to plan at another company. The company in question is Aberdeen. Before agreeing to the move, I decided to review them on Trustpilot. I was horrified to see they had an average of 1.2 out of 5 stars. The only reason it was this high is because the minimum you can rate them is 1. Anyhow, I've told him to leave it where it currently is, which is A J Bell. I may not be correct, and admit I know little about pensions, but at least I'll be able to sleep at night.

 

[117 M34]

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.

That's my thinking as same situation.
I've just got a 3% pay rise but just going to put it all in my pension.

 

[richardtheref]

My wife went to see a retirement/financial expert about a month ago. She's 63 and thought she'd next to no pension. They found a teachers pension that she hadn't realised she had as she hadn't worked in the industry for 40 years. It looks like what was in there has earned interest.
However, I was told I needed to be there with details of my pensions so they could have a true picture of our finances. I'm 58 and 2 years ago drew down 25%, paid off the mortgage, bought us 2 newer cars and gave my son his deposit on a house. Now when I was speaking to the guy he suggested I could retire now with what I have in my pots.
The only thing is I get the impression they are going to invest the pensions and then pay us a monthly dividend or something like that? I'm still not 100% sure but have another meeting 9th August

 

[hampshireblue]

I have 5 company pensions totalling around £30k which apart from 1 are all frozen at the moment.
I'm maybe looking into combining them all with something like pensionbee or just with my current pension. I'm no expert so not 100% if this is worth it or not or better off just leave them be.

It may be worth contacting an IFA for an hour. Combining them will almost certainly reduce ongoing costs.

 

[hampshireblue]

Just a quick reminder to everyone that if you have a non-working partner, you can still open a SIPP for them and put £2880 per year into it and the government then adds the tax relief on top to take it upto £3600 per year. It's no brainer for a non-working partner.

 

[denislawsbackheel]

And if they are over 55 they can withdraw that £3600 tax free and repeat the procedure every year. They are limited to how much they can put in a pension after that but it’s over the £3600 a year.

 

[hampshireblue]

And if they are over 55 they can withdraw that £3600 tax free and repeat the procedure every year. They are limited to how much they can put in a pension after that but it’s over the £3600 a year.

Just explain the last sentence please.

 

[Pingu the Penguin]

Does anyone know the answer to this? My missus is being made redundant in the NHS. She has for a pension statement which says she will get £x/yr at retirement. We are both assuming that this is an assessment based on what’s in her pension pot now (eg she won’t pay anything else in after she is redundant, obviously). Is that right though?

 

[Kompany Car]

Does anyone know the answer to this? My missus is being made redundant in the NHS. She has for a pension statement which says she will get £x/yr at retirement. We are both assuming that this is an assessment based on what’s in her pension pot now (eg she won’t pay anything else in after she is redundant, obviously). Is that right though?

Without knowing the exact terms of the pension it’s hard to tell but if you’re made redundant you normally get a statement to tell you what you have in your pension. DB pensions are normally based on 60ths or 80ths. So every year paying in accrues 1/60th or 1/80th of the average of your final salary over the final few years (normally 5yrs). More modern ones are career average, which are a bit less generous for most people.

So in theory she should get whatever that works out to every year and indexed against inflation (although sometimes this is capped at a maximum 5%).

 

[johnny crossan]

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.

spending it as fast as we can ;-)