To ask what a 'good' pension is?

[2birdsonawire]

What is considered 'good' as a pension contribution from you and your employer percentage wise?

I know this will be pro rata on a salary basis, just want to see if what I get is good or if I should look at other saving schemes.

Thanks

I get it matched upto 10% which for majority of people now is probably standard practice.

I've read it's recommended that you contribute half your age when you started saving into it as a percentage... So if you started when you were 25, you would want to save 12.5%. If you started when you were 40, you would want to save 20%.

My employer pays the legal minimum so it totals 8%. 5% mine and 3% them. This is private sector

As a comparison NHS employer contribution is 20%

Mine's around 33% combined - just under 10% me and the rest my employer (public sector).

My employer doubles employee contribution, up to a max of 12% from them. So total of 18% for me. Financial sector, previous employer was pretty similar.

Minimum employer contribution is 3%.

In the private sector a very good employer contribution would be above 10%.

5% - 10% ok and below 5% poor.

Usually to get the higher contribution from the employer you need to contribute the same %.

Public sector is a completely different scheme and not comparable

If your employer puts anything at all in, it's free money that wouldn't be available from a separate pension, and I believe they have to put a small percentage in by law as a minimum, so you should maximise your entitlement to this (some match your contributions up to a certain percentage) before looking at other schemes.

Private sector, pension contributions are 25%, we pay 6% and company pays 19%.

They are reducing their contribution to 14% in 3 years time.

I work for the public sector, I pay in 5.7% and they pay 27% although I have seen I can change my contributions so looking at this I might try to up mine to as close to 10% as possible. I've just had a promotion and as part of the promotion both contributions go up, I I used to put in 4.6% and employer put in 26% (around this amount as I haven't got the figures infront of me)

@2birdsonawire

I work for the public sector, I pay in 5.7% and they pay 27% although I have seen I can change my contributions so looking at this I might try to up mine to as close to 10% as possible. I've just had a promotion and as part of the promotion both contributions go up, I I used to put in 4.6% and employer put in 26% (around this amount as I haven't got the figures infront of me)

27% and you are asking if that is good!

Wow. I have never worked in the public sector. That seems amazing.

I think the gest I had was employer put in 12% and I put in 9%.That was financial sector. Other positions have been less because smaller companies

OP, i say this in the nicest way possible, what you have is very, very unusual.

Perhaps not in the public sector, but for the majority of private sector workers (outside of perhaps finance and a few others) you will be lucky if the emplyer pays much above the 3% minimum. Mine pays 4% which i top up with 12% from myself.

The general 'rule' for pensions is you should try and put in half of your age when you start contributing, so if you start your pension at 30 you should aim to put in 15% total.

I am aiming to be able to draw down about 3/4% once i retire, that way the principal should never run out. I think i would want about £30,000 per year in retirement, meaning i need a pension pot of about £900-£1mill

I get nothing despite earning over the lower earnings threshold!

I have 20% non contributory pension with my employer, I top up a few percent myself too but don't have to

I think anything around 10% is good, I certainly wouldn't want to stick with less than that

Where in the public sector pays 27%, I’m interested in joining?! That’s insanely good, it’s well above the offerings of the market leaders in just about every sector.

27% is exceptional (or would be in the private sector). Probably 3x the average.

Public sector pensions are much better than private. I think some people forget that.

@Jizzle

OP, i say this in the nicest way possible, what you have is very, very unusual.

Perhaps not in the public sector, but for the majority of private sector workers (outside of perhaps finance and a few others) you will be lucky if the emplyer pays much above the 3% minimum. Mine pays 4% which i top up with 12% from myself.

The general 'rule' for pensions is you should try and put in half of your age when you start contributing, so if you start your pension at 30 you should aim to put in 15% total.

I am aiming to be able to draw down about 3/4% once i retire, that way the principal should never run out. I think i would want about £30,000 per year in retirement, meaning i need a pension pot of about £900-£1mill

This also highlights something

A public sector pensioner with a 30k pension probably isn’t unusual under a final salary scheme. For someone else with a contribution scheme to get that they’d need a pot of a million pounds! Totally unachievable for most people.

I assume that you're on a defined benefit pension scheme? If that's the case the percentages aren't really comparable to people contributing to a defined contribution scheme. What matters for you is the level of benefit that you get from the scheme.

It's things like public sector workers wondering if a 27% employer contribution is good or not that makes workers in the private sector not be too pissed off when there's a public sector pay freeze.

Jesus, 27%? Sure you're not missing a decimal point?

A public sector pensioner with a 30k pension probably isn’t unusual under a final salary scheme. For someone else with a contribution scheme to get that they’d need a pot of a million pounds! Totally unachievable for most people

But only a minority of public sector pensioners would have a 30k pension. You'd have to be on a salary of 50/60k to end up with a pension that size and have had 40+ years of service. Most don't earn anywhere near that amount or have that length of service so actual pensions are usually much smaller.

@BarbaraofSeville

A public sector pensioner with a 30k pension probably isn’t unusual under a final salary scheme. For someone else with a contribution scheme to get that they’d need a pot of a million pounds! Totally unachievable for most people

But only a minority of public sector pensioners would have a 30k pension. You'd have to be on a salary of 50/60k to end up with a pension that size and have had 40+ years of service. Most don't earn anywhere near that amount or have that length of service so actual pensions are usually much smaller.

Someone in the private sector on 50 will have nowhere near a million pound pot on retirement. Lucky to have half that

@Jizzle

OP, i say this in the nicest way possible, what you have is very, very unusual.

Perhaps not in the public sector, but for the majority of private sector workers (outside of perhaps finance and a few others) you will be lucky if the emplyer pays much above the 3% minimum. Mine pays 4% which i top up with 12% from myself.

The general 'rule' for pensions is you should try and put in half of your age when you start contributing, so if you start your pension at 30 you should aim to put in 15% total.

I am aiming to be able to draw down about 3/4% once i retire, that way the principal should never run out. I think i would want about £30,000 per year in retirement, meaning i need a pension pot of about £900-£1mill

this in spades.

you have a good pension so you can relax...

Oh, so this was a boast

Mine is public sector. I pay 6.8 percent and my employer pays 16.2 - I consider that extremely good

A public sector pensioner with a 30k pension probably isn’t unusual under a final salary scheme. For someone else with a contribution scheme to get that they’d need a pot of a million pounds! Totally unachievable for most people.

The vast majority of public sector pensions are no where near that! The following figures are from a UK parliament research briefing in 2021 and are for the average pension in 2019-20 for the four largest PAYG public service pension : schemes. Armed forces £9779; civil service £8104; NHS £9709 teachers £12337

The maximum my employer contributes is 3%

I have received better contributions from previous employers

Also includes death in service