Pension income

I am late 40's and I am expecting State Pension to still exist by the time I am 67. Of course the age may go up again and it may be means tested, but I cannot see any Government completely getting rid of it. Hardly going to be a vote winner!

If you want to see what your investments might grow to in future there are various tools. A simple and free one is guiide.co.uk No need to register, just use the basic version and enter details of your current pension(s) and it will calculate what you may get at retirement.

How much would you spend in retirement, that is hard to know. I am basing on what I spend now, plus growth at 3% a year. With inflation high at the moment that may be unrealistic but assuming inflation comes down, then I think average inflation may be around 3% for my long term planning purposes.

@DragonFly98 you don't seem to understand so I think it is you who are poor at understanding money. For a start an £80k pension will be taxed so it is not £80k take home (as I've explained). I've also explained that this is a combination of two defined benefit pensions plus a state pension. Also, have you heard of compound interest? If you start your defined benefit early and retire 30+ years later then you will have accrued a decent retirement income. People can even pay in additional contributions to boost their pot.

It's very easy to spend £80k by the way. Some people (not me) blow £3k on a single handbag. People spend their money how they like.

Really feeling the stark contrast between public and private sector pensions here.

Silly question as many pensions don't have "pots" that can be measured in that way. Defined benefits occupational schemes and the state pension to mention two.

Do I have enough? No. Will I have as much as I want? No. Will I have enough to live on comfortably. Yes but it's not all income.

Anyone working in the public sector complaining about their pay should come on this thread and see how much better off in retirement they will be than those with DC pensions as I am assuming that the only people who have DB pensions are public sector these days.

I'm planning on having 10 good years on a reasonable salary until 75 then taking it easy.

A lot of my relatives did not get past that age and the ones did have really taken it easy after that.

So 10 years of travel and whatever left taking it easy in the garden and living much more modesty after that is the plan.

I'm guessing you're asking because you're close to retirement? Otherwise it's pointless.

At 42 I don't expect the state pension system to be functioning by the time I retire. I put minimal in because I don't trust any government. Too many excuses and reasons to not pay out or change things up. My money is being invested in other things and I expect to see a lot more out of it than either state or private pension, plus it's not tied up for anywhere near as long.

My husband and I retired early so we are not at state pension age for another 10 years. We live very comfortably (all be it abroad) on our pensions and a rental income totalling around £78k.
This will increase by 2x full state pensions when we reach 67.(We've both purchased extra NI years and have to buy another year each this year)

We were lucky enough to have final salary pensions (public sector) that came with lump sums. So we have no mortgage on either of our houses ,we also have reasonably healthy savings behind us and both hold the maximum in premium bonds.
Obviously if either or both of us require a care home in the future our money will be hugely impacted by paying for this but for now, at 57, we're living our best lives and thoroughly enjoying retirement.

You know that holidays, meals out etc are available at different price points, yes?

We did some maths, although it’s a way off retirement. My partner and I will have circa 3.5k per month combined in DB pensions and another 1.5k in DC pensions, plus SP. In today’s money.
We will also be mortgage free and use his capital to purchase a rental property in the UK and a home for us abroad. We will keep my property as our UK base. If he dies before me, I have about 3k per month plus state in today money and my home in the UK. I’ve asked that his properties remain in his family/kids.

This is all nice and dandy until someone needs to go into a care home and we’ll have to find the money for that or buy a ticket to Switzerland 😬

@BreakingAndBroke The words you should hear from any financial adviser is "the money you invest in a pension in your first years of work are the most valuable ones for your pension".

As you have nearly 30 years to go, anything you can save now will have years to grow in value.

By way of illustrating this, our DC was signed up to the family SIPP pot with 5% of its value before their 4th birthday, and we made only one contribution of £3,600 on their behalf. Their fund is now worth about £45k, at 25. The SIPP is outwith our estate for IHT, so anything we don't spend passes down untaxed. Their investment strategy for the cash element is very different to ours, because who knows what the world will look like in 2064. However, over every 10 year period since 1929, equity based investment indices have matched or beaten inflation. If you can bear to, it's worth reading up on the subject.

We (DH and I) have effectively been self-employed since we were 35, without any employer pension contributions, so unless we'd made our own provision we would only have the standard state pension in retirement. And as a PP said, even without a mortgage that's absolutely not enough for a comfortable retirement. My DM, now nearly 90, manages the basics of food and utilities on it plus pension credit but needs some equity release from her home (or help) to pay for new specs or hearing aids.

But we will spend around that much! We ski, holiday frequently, have gym & tennis memberships, pay for private physio etc. How do you know what we’ll spend?

I don’t know what any pots were worth, and I was widowed last year, but with my state pension, my civil service pension and my DH’s (private) pension “survivors benefit” pension, I clear (after tax) about 36k a year.

Along with a good amount of savings finally getting a better interest rate.

I do pay full rent though (social housing of £900 per month).

I manage ok though. 🙂

I get £900 per month and a lump sum of £67k. I had to flexi retire from the NHS
because of Long Covid so still work 1-2 shifts a week. I’ll have to do this until I’m 67 and the state pension kicks in, god knows how as it’s exhausting already.

Yes most people do but everything mentioned doesn't cost £80k a year. I don't understand how you can earn enough to have that high a pension, while simultaneously being so poor at money management.

Sorry, these are normally widely understood abbreviations on the money/retirement boards 😆
DB-Defined Benefit (pension).
DC-Defined Contribution (pension).
PB-Premium Bonds.
SPA-State Pension Age.

I don’t get why people are being funny about wanting 80k in retirement. It’s only 40k each. We both have good DB pensions. Mine will be 45k plus state pension. My DP’s isn’t quite as much.

We plan to spend plenty on holidays, weekends away, meals out etc. I don’t want a retirement of sitting in front of the TV all day. We all want and aim for different things.

Pfft. How the hell are you going to pay the butler and chauffeur on that piddling income?

Our current income is around £7k a month net. However we have a mortgage eat out regularly go to the theatre concerts etc and raise 7 children on that including 3 holidays a years and several short breaks. I just can't see how we could spend £2k less for just us a couple with no mortgage, and we plan to travel and generally enjoy our retirement.

this is an interesting topic and one which is at the forefront with us at the moment as we edge towards retirement - well in 14 years for me and 10 years for DH.

We should get around 35k pa in state pension - UK and abroad-, £20k pa private pension and will hopefully have around £10,000 pa bond interest depending on how they perform.

Our mortgage will be paid off by then and so living costs will be much less than they are at present.

I avoided the 'private pension' route as the returns didn't seem good enough for the value of the investment.

I'm hoping to have enough for about three years of fun post retirement and then after that, I'll just need enough for the roof over my head, wine and good food in the fridge, several media subscriptions, a trip to the garden centre a couple of times a week and a bit left to spoil my family, which if DC are to be believed, will mostly consist of grandcats. That'll do me. I have no intention of turning retirement plans into the next capitalist stick to beat myself with.