To ask how much your retirement pot will be

[Futurama1]

Off the back of some threads today, how much are you aiming to have in a retirement pot?

I’m going for 600k at today’s value which seems an insane amount but 20k per year for 30 years + state pension. What are you aiming for?

I put 2k per month in currently (inc employer contribution)

I don't understand how you can afford to put that away monthly on your salary. I earn about 5k a month after tax and with 5 kids and life etc I can't do that. I have managed to save absolutely zilch.
Well done OP for prioritising you! Congratulations!

I agree with pps saying women discussing this is important. In my my own circle of friends not one of them have a pension provision, and are all just assuming they'll get by on their dh's. My own dh himself has a half decent one and when I got to 35 and decided to do something about not having one, said to me don't worry we've got mine. Which is lovely in sentiment but actually no "we" don't have his, he has his and who can say what situation I'll be in by the time he draws it. It gave me a sufficient kick up the arse to get mine sorted. I started at the bare minimum contribution and every year or so I add 1%. Because I started so late my pot is currently paltry but I read somewhere £20k a year should be OK for an adequate life style so I'm aiming for that.

I'm already getting my occupational pension now at 55 due to ill health, I get £110 a week now but it is index linked so will increase with inflation each year & then I will get the new state pension if it is still there when I'm 67. I will be better off at retirement age than I will be from ds finishing school & tax credits/child benefit ending.

Gosh people are so jealous. People earn different amounts. It's life. If you don't like it, go move to North Korea..

I started paying into a pension as soon as I started full time work after college. My employers also contribute a percentage - that’s the equivalent of a pay rise / free money. If your employers contribute then it would be foolish not to have a pension. You also get tax relief. It’s a win win. But keep an eye on it, check the charges, challenge the managers, ask questions.

Women should have their own pensions today. You must not rely on another adult to look after you in retirement.

[quote Embroidery]@GenderApostatemk2 Thats shocking and disgusting.
There are people starving to death in this country and you get £720 per year free money you obv dont need.[/quote]
You clearly don’t understand how pensions work!! Instead of being abusive go and read up on them.

Discussing actual sums of money is too inflammatory on MN.

I used to pay a chunk off my mortgage every year, but realised that I might as well keep the mortgage going as debt is so cheap nowadays and save more using my annual tax free pension allowance instead. Then I can pay off any residual mortgage from gross pension instead of from my nett salary.

Good that you're planning ahead OP. So many of my friends don't have any pension at all. I'm worried for them. Christ knows what they're planning to do about it and weirdly none of them seem concerned 🤷🏼‍♀️

I’ve got one through work that I’ve been paying into for twenty odd years. It used to be a big lump sum with a lovely annual amount not far off my salary. Then they changed the scheme and now I have a small lump sum which will be enough to buy a tent, plus an annual sum which will hopefully be enough to pay ground rent on a patch of wasteland somewhere we can pitch it. DH’s pension won’t be enough to buy us a daily paper. There’s not much chance of the state pension still being around when we’re of an age to collect it.

We will not be retiring. I think lots of people will be in the same boat.

@Sn0tnose

I’ve got one through work that I’ve been paying into for twenty odd years. It used to be a big lump sum with a lovely annual amount not far off my salary. Then they changed the scheme and now I have a small lump sum which will be enough to buy a tent, plus an annual sum which will hopefully be enough to pay ground rent on a patch of wasteland somewhere we can pitch it. DH’s pension won’t be enough to buy us a daily paper. There’s not much chance of the state pension still being around when we’re of an age to collect it.

We will not be retiring. I think lots of people will be in the same boat.

Chinny reckon 🤣 I don’t believe for a moment that the lump sum from 20 years of contribution is in the hundreds, tent purchasing sums. Such hyperbole isn’t helpful.

When your scheme changed, was it DB Final Salary to DB Career Average, or DB to DC?
Was your historical entitlement built up ring fenced in some way?

Interesting how few people think there will still be a state pension when they retire, given how careful the government is now to avoid anything that displeases pensioners.

@Iwonder08

Parking aside the obvious problem that this thread was bound to be considered goading.. You are not on a very high salary, given you gave 30 years plan you must be about 30 something. I wonder why did you decide to prioritise such a massive proportion of your salary contribution to your pension vs all the potential investment options? Unless you already have a chunky investment pot, properties, trust funds etc it doesn't sound very sensible at your age

I've been advised to put max into pension if I can (haven't any year so far but this year will) because it brings down tax, I get contribution from gov (self employed so no employer) and I started late (at 30 - again, as self employed couldnt afford at beginning of career to cover my insurance and memberships etc and also pension. Error not to have at least put something small in but it is what it is). So I am in 30s and paying about £750 a month in myself as well as lumps when I can to catch up from previous failures to pay in but I dont have property investments bar my own very modest home nor trust funds or anything. Advisor suggested insurances and £15k safety net first as I'm self employed, then pension contribution next up to maxed allowance because that helps with tax and free contribution from gov, and then if anything left look at other investments

I have heard it said that half your age as a percentage of earnings is a good amount to aim to save (obv not always possible if earnings very low). I probably need to save more, was debating opening a SIPP and moving old bitty pension into it but I need to understand it better first. I contribute extra into my work pension and also do salary sacrifice. Don't wanna end up in same position as some family members who are really worried about money and nearing retirement, they don't seem to have planned for it at all.

The half your age is just a rule of thumb and more of a talking point to describe that staring earlier is better. It’s related to when you start contributing.

If you start age 20, you can pay in 10% for working life for an adequate* pension, but if you don’t start until you’re 40, you’ll need to put in 20% to make up for lack of earlier contributions.

*reality is, everyone needs to do their own numbers on this

For someone starting out with a Sipp, you can’t go wrong with interactive investor, it’s a flat fee of £10 a month + fund charges, (something like Vanguard lifestrategy 80) charges 0.22% annually or go for a target retirement fund for the year nearest your planned date, that automatically derisks as you get close to the date. Vanguard is a good Global fund of funds that spreads the risk around so you don’t need to actively rebalance investments.

The main thing when approaching retirement is to either have 3-5 years income in cash savings or cash funds within your pension to draw down on if there is a major stockmarket crash. You do NOT want to be selling funds when they have lost 40% of their value!

I would also like to know how ethical the investments are and the rules, fees etc. So a bit of research to do.

Chinny reckon 🤣
I don’t believe for a moment that the lump sum from 20 years of contribution is in the hundreds, tent purchasing sums.
Such hyperbole isn’t helpful.

When your scheme changed, was it DB Final Salary to DB Career Average, or DB to DC?
Was your historical entitlement built up ring fenced in some way?

@Cocomarine 😂 Haven’t heard that for years! That really made me grin. I do have a plan B if it’s not tent level money, involving several rolls of blue rubble bags from the pound shop and several rolls of gaffer tape.

I’ve been described as a financial flibbertygibbet so unsurprisingly I can’t recall the finer details. I just tend to look at the forecasted amount. I do know that my pension statement gives details of both schemes though, so I’m assuming it has been ringfenced. They did ask us to switch over to the new plan voluntarily and I declined on the basis that if they were suggesting it, it clearly wasn’t going to benefit me. Then they pulled the unions in and made it compulsory.

And funnily enough I haven’t heard “flibbertygibbet” for ages, yet used it only yesterday to describe my teen’s approach to homework 🤣

It is gutting when a good scheme changes. Mine did when I was 35, and my projection when from a £30K per annum pension to £20K literally overnight! (and I appreciate that £20K is a load more than most, not disputing that - just that a recalculation from 30 to 20 in one go is eye watering!)

I just try to focus on the fact that I’m lucky to have what I do ringfenced - and actually the pension after the change is still very much worth having.

I’m sorry to jump on your comment 😀 it’s just that what is hyperbole for you really can feed into the belief of others that it’s not worth bothering, and I think that’s dangerous.

I see so many people on MN saying things like “it’s £1K a year, nothing”… and I think - so if they had £9K state pension and the government reduced it to £8K, would they say, “no problem, a grand is nothing anyway”? Would they fuck!

Oh God no, I would never say that saving for a pension was pointless, sorry if it came across like that. I think it’s a really silly move not to have one or to rely on anyone else’s, so no need to apologise for picking up on it. 🙂

I invest around 6000 pcm, give or take depending on how many bars of tony chocolonely I've bought that month

So much jealousy on this thread! OP thanks for giving us food for thought even if you did disappear sharpish

So much jealousy on this thread!

Why assume that people pointing out a complete lack of sensitivity in the OP's first post, is jealousy ?

I'm not jealous. My working life has never been well paid, but, one compensation is that it has come with excellent pension. I am not too concerned about my own pension situation, but that doesn't mean I can't see that the post was, to put it politely, insensitive (as was the follow up about salary).

@TertiusLydgate

We’re buffoons with money but I think we both have pretty good pensions with generous contributions from our employers.

My husband’s pot is worth £450k and I’m not sure about mine, but my yearly income at retirement is currently forecast at £33k. I’m not even sure what we should be aiming for.

There’s also a lump sum with each which you can choose not to take to beef up the yearly pension. I keep thinking I must look into additional contributions etc, but it’s all a minefield to me.

33k is amazing. Mine is estimated at about 16k pa and I'm now paying in 750 a month and lumps when I can to try and bring it up as I'm the breadwinner

Dh was just lucky with his one and we don't live like kings either to be honest
Many self employed people are much better off than we are and many will inherit loads from house sales too. I think they might even be better off than those with pensions via parents and g/ parents
I never will as parents didn't own their own properties!
It's all swings and roundabouts isn't it?

@Alonelonelylonersbadidea

I don't understand how you can afford to put that away monthly on your salary. I earn about 5k a month after tax and with 5 kids and life etc I can't do that. I have managed to save absolutely zilch. Well done OP for prioritising you! Congratulations!

Really? You can't understand dhow OP puts away so much. Either your stupid of your being sarcastic.

But if that stupid how are you maintsing a job that pays you £5k if you can't even understand that having 5 kids clearly drains your money and that you prioritised having a bigger family instead.

Well at least with 5 kids they can help you out in retirement if you end up with nothing

I don't understand how people say they are putting nothing towards a pension - since 2019 between you and your employer you are meant to be contributing 8%. It's not huge but it is a contribution.

www.gov.uk/workplace-pensions/what-you-your-employer-and-the-government-pay