How much needed for retirement?!

[soveryconfused85]

I am 39yr old female, pay into work pension every month but I struggle to understand if it is enough or if I need to do something additional

Can anyone please educate me on rule of thumb saving needed (ie X% of salary per year at 40/50/60 etc).

thanks!

Fist it’s good you’re thinking about this.

secondly, general rule of thumb, save as much as you can whenever you can. 🙄😉 but that’s not always possible. or, in some circumstances sensible. In others it’s plain silly not to…it all depends.

third, if you’re serious about getting on top of your wealth management and pensions, then start to make use of the huge wealth of information on line. And do your research based on your specific circumsantnces. For instance, I copied your question into google and in 1 minute got numerous links to sound rule of thumbs by age group…but it is still only guidelines generally and not specific to you

fourth, no one on here can, or should’ve tell you what to save. We don’t know your exact financial information, or your risk acceptance level etc. only you do. Or a professional independent financial advisor who will Extract relevent details from you. But they can cost, and so not possible for everyone on limited funds.

However, most of stuff is not as difficult as it seems. You do need to understand and take control. And you can. Honestly. It just needs you to take a bit of time over a few weeks doing some reading

A good starting point is to get a session (free) with Pension Wise service to review at high level your circumstances and explain pensions to you well . Search on line and book your appointment, usually 30 mins and free. Government initiative, that everyone’s entitled to. They used to hold these at local governemnt office and civic building, but might even do on line these days.

martin Lewis has great advice too on the MSN site. But you’d also do well to do his on line financial course about money management anyway. He’s tried to get it taught in schools, but it’s available free to adults on line that you can do at home in small chunks. There’s a lot in there about pension savings and managing your money generally. Please do give it a go - they’ll be stuff you know, and even that’s reassuring to build your confidence that you do know what you know!

i know it’s not answering your question and you wanted a quick simple answer. But I’m genuinely trying to give you good advice thstl set you up for future …the old give a man a fish and feed him for a day, teach a man to fish and feed him for life ….

post on here for stuff you’ve read and still don’t get, or want to validate ….but your question is so wide and basic no one on here can give you an answer that’s worth Listening too…it entirely depends on your fine details of circumstances

The consumer group WHICH also used to do excellent guides on preparing for pensions…sorry forgot that source !

@soveryconfused85

Which guide that @Limehawkmoth mentioned.

Gives a rough idea but you know your current finances and where you prefer to spend your money

You have to be over fifty for the free advice (it's more guidance) from Pension Wise.

I know many guides out there say to have a basic pension save X for a reasonable pension Y and for a comfortable pension save Z. It's difficult to say because there has been talk lately of means testing the state pension. State Pension is currently 11,973 per annum. You should be aiming for at least £9k private pension a year. That would give you approximately £20k per annum which is a basic retirement. I can tell you what I did. I will get full state pension £11,973 plus I already get £11,500 p a teaching pension which I got from 60 plus SIPP pension via annuity £6.2k p a. I also have a btl portfolio and gain income from that each year. I have a comfortable retirement.

Try using a pension calculator like pensionbee or moneyhelper which will let you put in what you have saved, how much you are currently saving and your hoped for retirement age. It will then produce what sort of income you will get. That should help.

If you have a property, assume you will be mortgage free before you retire. Work it out on the basis that you will take 25% tax free. That 25% would form the basis of your savings that you pull on during retirement for house repairs, buying in help and expenses like a new car.

That said so long as you have savings to cover you if you lose your job etc. and you are gradually paying down your mortgage, the more you can put into a pension up to the point you can get tax relief, the better as it is a huge boost.

I’ve retired; dh is working down to retirement; we have/will have a comfortable but not extravagant retirement.

We both come from backgrounds where saving for a pension was not possible/considered necessary. Late second marriage for both of us.

His strategy - work for a government organisation with a good pension and trust you are in safe hands.
My strategy - none, but a vague focus on property with a view to downsizing, plus taking advantage of workplace pensions when they came into being. Ran my own business for many years so income varied but always made sure I contributed NI so I get the full state pension.

Looking back, there were so many unknowns when I was at your age and so many changes to come. I would say

• do make sure you’re eligible for full state pension - it’s not enough on its own and will kick in later than you might want to retire but it is a very nice addition to our income given we have no mortgage.
• Keep a general eye on your overall equity but if you have children under university age keep your savings expectations realistic for now
• Live the lifestyle your income matches - not too much, but also not too little. I wouldn’t swop my family holidays and lovely home for a little more income now. And I wish I’d bought a decent car sooner.

I'm a couple of years younger than you. I just assess it periodically to what is happening in daily life. For example I work part time so I know I'm not putting in a great amount at the moment (me 8% employer 4% I think). I was previously putting in 4% then got a 3% payrise so doubled my contributions. Our mortgage is about to be renewed on a lower rate and I'm potentially about to pick up more hours. So I am looking ahead to increase my contributions further which will hopefully make up the shortfall of being part time at present. We've still got another 25 years of work until state pension age at present time. That's still lot of time for the pension to grow significantly.

Edit to add: I don't think I'll ever fully retire unless it's ill health. Also I would hope we will downsize and use the profit instead of me taking a lump sum making my pension higher monthly.