I get where your coming from with the spending, I'm still reluctant to buy for myself unless it's absolutely necessary but I get great pleasure spending it on my two kids, whether it's meals out or things that make life a bit better for them.That’s the hard part of being retired for me.. getting your head around spending your savings when you’ve done the opposite for so many years
Try usanyone know about AVCs?
Looking at the last para: with that in mind, isn't just easier to open a SIPP? The only differentiation would be if the employer sees the AVC and contributes something towards it as well.A bit open ended on AVCs but really good to avoid moving into the higher tax brackets, so good to raise the amount every year before you get a rise due to cost of living or a scheduled increment.
Then there is the separate questions on:
1. No idea, I split mine 4 ways with different risks and investing in different things. Whatever you do it's a gamble that you may have taken too much risk or not enough.
- what to invest in
- how to draw them down when you retire.
- Massive increase in contribution on your final year/s
2. Depends how much you have and are they a bridge to deferred DB pension/what other income or pensions you have due to tax thresholds and allowances.
3. Some pay the majority into AVCs the last year or two, even get a loan to live on then pay it off, especially if a good proportion subject to 40% tax or more. Obviously it can be done without a loan, and a lot of schemes ensure you can't leave yourself less than minimum wage after AVC contributions.
They are a no brainier to avoid 40% or even 20% tax if you can afford it.
If you change jobs a lot, even with the same pension scheme but different employer they stop and start so there will be gaps of several months were you can contribute. If you change employer and scheme, and need to transfer pensions, the AVC contributions will stop for at least a year, so worth bearing in mind if close to retirement.
Home and land have historically been very good investments. It is also tangible which means you can physically enjoy your investment unlike staring at a pension statement or a bank balance. The downside is it can be an indication of wealth that others can openly see, so that creates envy. On several occasions I have had people saying why do you need something so big when there are just the two of you.My only advice is to own your own home, not bothered if it's a mansion or a bedsit it will help you no matter what life decisions you have made on pensions.
My outgoings on the council tax/ water/ gas/ electric etc. is around £650 a month and state pension being about a grand, so not all singing and dancing but it's safe.
If your rent is coming in around £800 then you will be needing savings to cover the bills.
if you have a modest private pension and the state pension you hopefully will be fine if you are fortunate to have a place you own.
Everyone has their own journey and each will be different so don't get carried away dreaming of a rich and prosperous retirement when most of us will and should be content with comfortable and similar to the life we are living when working.
Getting back to my advice on owning your own home is similar to the pension pot, you don't need a mansion just a place to call your own.
We downsized nearly 10 years ago. Apart from losing the utility room it's the best thing we did.Home and land have historically been very good investments. It is also tangible which means you can physically enjoy your investment unlike staring at a pension statement or a bank balance. The downside is it can be an indication of wealth that others can openly see, so that creates envy. On several occasions I have had people saying why do you need something so big when there are just the two of you.
There can be a lot of hassle with maintenance, particularly getting tradesmen. As one of the rooms lets me indulge in my hobby uninterrupted, model railway, whilst we are mobile we will stay put in the countryside. I don’t know how we would cope with town noise, close neighbours etc if we downsized.We downsized nearly 10 years ago. Apart from losing the utility room it's the best thing we did.
It isn’t taxable currently.I have an option of taking a lump sum on a defined benefits pension which reduces the annual pension amount.Is this taxable ?
I am retired,no income or state pension yet.
Living off savings.
It may be, I don't know anyone who has done that in relation to AVCs when part of a Public Sector DB pension, and can't comment constructively on others.Looking at the last para: with that in mind, isn't just easier to open a SIPP? The only differentiation would be if the employer sees the AVC and contributes something towards it as well.
No. 3. Beware of the pension recycling rules.A bit open ended on AVCs but really good to avoid moving into the higher tax brackets, so good to raise the amount every year before you get a rise due to cost of living or a scheduled increment.
Then there is the separate questions on:
1. No idea, I split mine 4 ways with different risks and investing in different things. Whatever you do it's a gamble that you may have taken too much risk or not enough.
- what to invest in
- how to draw them down when you retire.
- Massive increase in contribution on your final year/s
2. Depends how much you have and are they a bridge to deferred DB pension/what other income or pensions you have due to tax thresholds and allowances.
3. Some pay the majority into AVCs the last year or two, even get a loan to live on then pay it off, especially if a good proportion subject to 40% tax or more. Obviously it can be done without a loan, and a lot of schemes ensure you can't leave yourself less than minimum wage after AVC contributions.
They are a no brainier to avoid 40% or even 20% tax if you can afford it.
If you change jobs a lot, even with the same pension scheme but different employer they stop and start so there will be gaps of several months were you can contribute. If you change employer and scheme, and need to transfer pensions, the AVC contributions will stop for at least a year, so worth bearing in mind if close to retirement.
Bloody environmentalists, they can shove their net zero where the sun don’t shine.No. 3. Beware of the pension recycling rules.
It will be tax free upto the limit of £268275. I guess the real calculation you need to make is what the affect is how much your annual pension will be reduced by taking the lump sum.I have an option of taking a lump sum on a defined benefits pension which reduces the annual pension amount.Is this taxable ?
I am retired,no income or state pension yet.
Living off savings.
I'd be amazed if anything she announces would come in within at least a couple of years and I suspect that may be the maximum you can pay in or the tax relief applicable.Im looking to retire next year but am keeping a close eye on the November budget to see how much she wants to siphon off. Might mean i take benefits earlier if she starts tinkering with the tax free lump sum and reduces it significantly. I work in pensions and have built up an healthy DC pot to use drawdown and a DB(career average) pension that kicks in at age 65. Wife doesn't work but I have been paying 240pm into her pension for several years.(300pm with tax relief). Like others on here, being an higher rate tax payer, I use salary sacrifice to pay into my DC pension which means I save 40% tax and 2% NI. Mortgage ended 8 years ago so i diverted those payments into the pension instead. I'm fortunate that my employer also pays 13% of my salary into the pension too. Will be on a much lower monthly wage but pretty sure i can make it last and enjoy my retirement. (Until at least age 67 when I will have both my career average pension and state pension - wife's state pension kicks in 2 years after me
That’s the hard part of being retired for me.. getting your head around spending your savings when you’ve done the opposite for so many years
I'd be amazed too. Even if she does tinker with it you'd expect some lead time for providers to implement any changes and possible some protection similar to the Lifetime allowance protection before it was abolished. I suspect, like you, she might tinker with the tax relief.I'd be amazed if anything she announces would come in within at least a couple of years and I suspect that may be the maximum you can pay in or the tax relief applicable.