Will I ever be able to retire?

[ChildcarePanic]

I'm 32, have been trying to pull my numerous pension pots together and work out how I can maximise my retirement fund. I know a lot of people have no pension fund at all but I'm still worried. I'm not in a high paid job and by my predictions unless I start earning significantly more, will have a workplace pension of 120k and then state pension. Would probably be fine if I owned a house but that isn't something that looks remotely possible for me. If rent stays as it is and I'm paying my current 950 in rent into retirement, I am not sure I will ever be able to comfortably retire. A quick Google tells me I will need a lot more than this. Does anyone have any tips on how I can maximise my pension or are people just doomed to work the rest of their lives? I'm really hoping things will change by the time I retire!

Not the answer for everyone but I joined the civil service around your age. I’m still not a high earner, but I have a reasonable predicted pension and lots of flexibility at work. Hoping to either retire or drop to 3 days at 60 depending on how much the kids cost as they get older.

That's good to know. Are you renting too? This is the main thing I worry about.

We do own a property, but I’m 16 years older than you so appreciate that was easier to do than it is now. Can you look at shared ownership/ 100% mortgage or clubbing together with a friend? £950 is so much money on one salary, our mortgage was half that before we reduced the term by half and increased our monthly payment. Alternatively could you move back in with family to save for a deposit?

I'm the same. To be honest I've questioned whether it's even worth paying into a pension. I will never own a house so my pension will be swallowed up by rent when/if I retire. If I didn't have a pension the government would pay it. The money that goes into my pension would make life easier now.

Oh and I'm over 10 years older than you so definitely won't be buying a house

@Dyerun it us always worth paying in to a pension because of the Govt tax relief that gets added. If you kept that money instead of putting it in a pension you’d be taxed on it so would see less of it anyway. And it’s far better to have a smell pot in old age than no pot.

OP, I feel for you, it is hard- but you’ve got more in your pot than I do, and I’m 37. DH is 37 and has just £17k!!

He’s a high earner, and we at last managed to get on the property ladder at 35, which is something.

It is always, always worth putting in to a pension. With the amount you’re putting away you could retire on a decent pot at 66. As you get older and hopefully earn more/get promoted you can add more to it. Or look for a job in the public sector where pensions are still generally more generous.

As to buying a property, keep saving for a deposit, ask parents if they could help you out (I know not everyone’s can, ours could but only post retirement and £12k each which we’re going to repay!) and keep looking around for 1 bed flats (beware new builds with their attendant leasehold/cladding issues).

Good luck OP. I’ve been there re housing and it feels so frustrating, but you’re still young enough to buy and build a big pension pot. Don’t give up.

*small pot @Dyerun not smell - bloody phone

Can you look out for new jobs where the employer puts more in?

I’ve recently changed jobs and if I put 6% in my employer puts 15% in which is really good.

Could you do something a bit different and rent a room for a few years to save a deposit? Personally I would go all out so I could buy somewhere even if that meant a room in a shared house for a few years and a second job and then moving to a cheaper area if needed.

When I was single and had bought somewhere I rented one of the rooms out under the rent a room scheme and although it wasn’t ideal, I really needed the money.

I'm torn on the whole pensions thing.
I've seen so many people retire then pass away ridiculously quickly (within 6 weeks my dad was dead from a huge CVA) therefore never getting the benefits of what he paid in.
He scrimped and saved all his life to "do the right thing" in throwing all he could into that pension. He was determined to enjoy his old age, so basically flogged himself to death.
I also work in an environment, where I see those who have savings/pension pots having to pay extortionate care fees and those who haven't any savings, getting the same care for free.

I am tempted to say just live your life OP, have holidays and buy nice things!
However, the sensible me says you have another 35 years of work ahead of you. Plenty of time to retrain in something better paid or start your own business if you want to. But don't forget to live in the meantime. Have holidays.

You have 35 years to go before you can get state pension.
who knows what will happen then.
its only people on the old state pension who can claim pension credit, they are saying people on the new state pension won’t be able to claim anything.
an awful lot of laws can be passed in the next 30 years to make it really horrid for people who could have saved into a pension fund and chose not to, people just like you OP.

I am retiring at 60 at the latest. I will be knackerd by then, there is no way I could work another 7 or 8 years full time at that point.

you have about 30 years to go on saving into your pension fund, it will be huge when you are 60 ish, and will give you choices.

As it stands at the moment retired people can claim housing benefit if they have low income. This would apply to you.

The problem is that the state pension system is a Ponzi scheme, which will inevitably collapse. All political parties should be planning what to do when this happens. Anyone with 30 years still to work is probably going to have to rely on a defined contribution company pension.

There's a balance that needs to be found isn't there? Renting a room as a pp suggested and scrimping to save a deposit may be sensible for OP. But scrimping and going without for the next 35 years so she can have a good retirement probably isn't.

If I was you OP I would look for a public sector job as the pension tends to be very good compared to the private sector.

Move to a cheaper area where you could buy? That may mean a pay cut and less into pension but you'd be mortgage free when you retire. Do you have a LISA? That really helped me save a deposit.

Or look for a higher paid job. Even a slightly higher salary will mean higher pension contributions.

If you have a Nest pension it's easy to add in extra sums when you have it (min £10). If I have some extra cash like selling on vinted I'll transfer it to my pension. You should go through your income and expenditure and see if you can spare any cash - even another £10 a month over 35 years will make a difference.