Pensions or live life (when you can’t save much anyway)

[Heyhowhatsup]

This is a combination of two threads I’ve read tonight which coincidentally have captured the predicament I feel in. The threads are the one about heading for a pensions disaster and the other is about why do I never use my best stuff or treat myself and posters saying life is too short to not live and enjoy and value yourself.

I completely agree. I’m a low earner, very successful job but doesn’t pay well. I don’t have a pension or much of one. Have started saving but I’ll never be able to save a huge figure let alone one that will even make much of a difference. I come from
a very poor background so there’s no help or inheritance I can rely on. Also from a small family so worried I won’t even have anyone physically to help when I’m old.

I guess the quandary I find myself in now which the two threads have brought to a head is i could keep saving for a pension. It won’t end up being a lot but perhaps I should. However it would mean my quality of life which is already very low would become even lower. As it is, I barely treat myself or enjoy life.

how do you square the two things? Maybe you can’t.

How far from retirement are you, OP?

28 years

What do you mean by a very successful job that doesn't pay well?

Your age really matters here with what options you have.

I’ve done very well in my career and am ostensibly very successful. I love my job. However it is very low paid.

I am 38 years old.

Even a small amount of money will accumulate quite nicely over that period of time.

First, does your company have any sort of pension plan that you could participate in?

If not, I would suggest putting aside an amount that doesn't cause misery and investing it in a Self-Invested Personal Pension.

If you expect to be on your own, I think you will find that having a pension will give you a sense of safety.

PS - Of course you might not be on your own, OP, especially if you don't want to be.

But every woman needs to have their own personal financial security whatever their circumstances are.

Your pension age isn't 66, it's 68.

Op, you are only 38. You literally have decades to earn more.

You need a higher paying job, if you’re successful then you’ll easily get a higher paying role somewhere else. You’re only 38, you’ve got 30 years to save into a pension.

Does your employer contribute?
Pension savings get taken from gross salary so they are tax efficient

I would save some into a pension start small, 2/3/4% of gross pay.

And don't forget to live

(And look at moving for higher pay)

28 years is a long time to go, even if you save 1k a year that's 30k with interest. I think ita good to have some savings, no matter how small, so you have some control over your destiny.

I so wish I had taken the opportunity to save for my pension in my 30s. Now I’m 60, divorced and dreading getting old because I’m afraid of being poor. My pension is tiny. 🥺

I don't understand any of this pension angst. My DM is the stereotypical 'poor widow' as in she has the state pension and a very small top up from my DFs pension.

Her income is probably around £1200 pm, but she does own her own home, as do many pensioners, she's never inherited a penny because all my grandparents rented and left nothing.

She's absolutely fine. Granted she can't afford to go on world cruises, eat at The Ritz or blast around in sports cars, but she doesn't want to anyway. She can afford to eat what she wants, has pets, puts the heating on as needed, go out for lunch, go on days out and UK holidays, treat grandchildren, have work done on the house buy tat.

But on here, people seem to believe that if you can't save a million plus, you'll be sitting in the freezing cold and dark, existing on cold beans. Very odd.

In my 50s I was you.there was 50 k saved so nothing really.i got a job I loved with 12 HR days and saved and earned loads.I now have a decent pot.I worked all my life but never had much left.
I agree about low earnings and none of us know how long we ve got but looks at your spending.
I allow 10 pound a week then last few yrs and use the clothes and bits I already have.

@Bjorkdidit If you own your home, you’re in good shape financially. I don’t.
To all you young’uns reading this, SAVE for your pension and get on the property ladder asap!

@Bjorkdidit If you own your home, you’re in good shape financially. I don’t.
To all you young’uns reading this, SAVE for your pension and get on the property ladder asap!

What do you mean £50k is ‘nothing really’ ? It’s a huge amount of money.

Lots of people can't own property as they simply don't earn enough to buy it in the first place or maintain it.

It housing wasn't and isn't a problem for lots of people in their late 60s+ as they are either in social housing or managed to buy when was cheaper.

(Granted there are also those those who lost secure housing due to divorce and separation but the social housing list is different if you were over 60 then under it.)

She has 30 years at least.

The state pension age will be a minimum of 68 when she retires though it could be 69. The OP will only know for sure when she's in her early 50s.

If the OP was in her late 50s I would say don't save but at the moment she should save into a pension. Plus try to get a better paying job.

For most of my dh working life he worked for himself , and wrongly , pensions were on the back burner .
Then we moved to another part of the country ( uk ) and he became employed rather than self employed.
That was 15 years ago , the company has an excellent pension scheme and dh also put in extra % of his salary to help top it up .

He was 48 when he started , so 15 years on , he's built up a pension of close to £350k so it can be done in later life

Don't think you are xx age , so too late to start , there is time in most cases.

Please look up compound interest and the tax incentives associated with pensions. Maybe try a pension calculator. Even starting small it will be much smarter to do that than buy yourself a nice moisturiser or whatever else to make right now nicer.
pensions are not the same as a savings account, and should be prioritised over many many other things.

Not everyone measures job success in monetary terms

My mum is pretty much the same. Lives in social housing in a pretty nice area. Has the state pension and seems to manage quite well, runs a car, eats out etc. she has more in her current account than I do at the moment!
she manages to buy tat as well !

Can you give a ballpark figure because this doesn't make sense. Some people think 80k is low paid..

If you are working in a role that is generally well paid then look for another job if your employer is under paying you.

The key thing about a pension is that if you don't contribute, then you are missing out on free money from the company contributing. It might be 3% if you're on the gov opt out scene. This is part of your renumeration. So if you're earning 1k a month, you're contributing £60 and the company matches that's £120 a month 1.4k a year, not considering interest and gains due to the pension investment.
Even that small amount may be the difference between you keeping and using your nice things or having to sell them.

Op, can you save 25 pm in to a stock and share pension?
Open up your own pension in a sipp, self investing person's pension and put the min in when you can hopefully 25 a month.
That will have plenty of time for it to compound, look at index funds