To think I am fucked for retirement?

[Realstudd]

despite a decent job and income, I am absolutely rubbish at anything financial. I don’t understand pensions etc.

i became a single parent last year and I have one dc, 9. I am 42. I have 3k in savings but these are used for car stuff or emergencies and never get beyond 3k.

i looked at my pension pot the other day and it says 2,400… I’ve been paying in for over 9 years, 8 percent of my salary. My salary has always been over 35k and for a few years has been over 50. I don’t get how the pot can be so low?

the only positive is I have 140k left on my mortgage which I overpay so could be paid off in 6 years. But what good is that really if I can’t afford the bills! I feel like an idiot for not having planned ahead, I guess I will lose my home and have to go into rented to pay bills when older? What do people do? I go from feeling insanely stressed about it to accepting that that’s just how it is but I can’t picture my future anymore. What do you do in this situation?

It's only people that were contracted out that need more than 35 years, I was and I had over 40 years and am about £50 a year short of a full pension, it wasn't worth me making top up contribution though for that amount

I don't think you will need to sell a house that you own to pay the bills. You will get a state pension too remember. It isn’t a lot but combined with your workplace pension (which you still have a long time to pay into) you will most likely make ends meet. The 2k you are putting towards your mortgage every month now will be going into savings 6 years from now when the mortgage is paid off! That’s £24k of savings every year!
If there is a problem for any reason, you will need to keep working a few hours a week. There are quite a lot of elderly people on the checkouts at my local Morrisons, I assume they are there to supplement their income.
Much better than selling the house!

If you can overpay a bit more on your mortgage I’d do that.
Once youre mortgage free that frees up a lot of money. Then in retirement you make your asset work for you. Rent a room out, do Airbnb, buy a terraced house and divide into two flats ( I almost did this when I returned to UK)
Due to retiring early and DH dying young I don’t have a big pension by any means , my income is minute by today’s standards, but my outgoings are low, I can afford a long weekend away every other month easily.
Really it’s not the disaster you imagine.

I had several jobs whilst younger, all worth paltry pension amounts. I used pension bee to consolidate them all in one place. I am lucky that I will retire in my current role (am 39 so 25+ years left to work) which has a final salary pension, so I'm not overly concerned that my private one is so low. I think it has around £20k in it.

I found pension bee really easy to use and would recommend.

What is your pension invested in? Last year bonds went down in value so it could be that the value of your pension has reduced. It doesn't sound like much, given the amount of time you've been contributing so I would look into this. I think you should possibly start a new private pension and try to contribute more to your retirement. Don't panic - there is still time to do this.

@Realstudd lots can happen between now and retirement.
If you pay your mortgage off in 6 yrs (which is brilliant) you will have years to save more as you'll have no mortgage payments!
Also, you could, in the future, sell and buy somewhere or something cheaper and use the profit to spend as you like.
Edit to add... keep overpaying the mortgage. The fewer yrs the less interest you'll pay. Don't pay less on the mortgage and pay more into savings, it's counterintuitive.

Is it possible that you have misread the pension statement and that the £2400 is the amount of annual pension you have accrued rather than the amount invested.

Is this a defined benefit pension? Sounds like it. That’s worth £2400 a year for life on top of (assuming it still exists) state pension.

you’ve got more than 20 years to increase that and you can always make voluntary additional contributions. Speak to a financial advisor. It’s never to early.

I wonder what people with no private pension and renting do. Those who don’t own their home.

since they have full state pension and are not entitled to pension credit….like how do they afford these crazy rents on 800 something state pension

Hi Op,

You will have had a pension pot opened by each employer - the pot doesn't move with you when you move jobs.

Do you have any pension related paperwork or emails from your previous employers?

If not, I would contact HR/manager etc at your previous employers and ask for the details of the pension provider during your period of employment. Once you know who the pension was with, the provider should be able to trace this for you.

I would then look at combining all pensions into one pot.

@Snoopsteandcooper hi it must be defined benefit then as that is what was described to me when I joined the company. What does that mean for the amount I can see on my online banking? Is that my current estimation of what I will get per year?

On that basis, pursuer's total pension pot might be approx £50K and she's projected to receive £2,400 per year? Sounds feasible, after paying in for a number of years

I think you need to find that out for sure one way or the other - DB schemes are great and if it is one that will be fab but they are very rare outside the public sector so it would be worth checking any paperwork you have as it is likely to say what sort it is - or ask HR at work.

@Realstudd you need some independent financial advice to help you. An advisor can help you work out where you are now and what you need to to do to plan for the future.

As others have already said, you probably have several pensions from different employers. An advisor can help you to pull all these together.

Don't despair, you have 25 years left to work and you are in a good place with regards to your mortgage.

My pension that showed on my online banking didn't show much detail, just the amount saved, though yours may be different OP. Do you get a letter each year from the pension company as that will have much more details in it, or log into your actual pension website.

Op, have you got a pc. Create a spreadsheet with the three pension companies you have been enrolled with, and add the account number to each line.

Then, once a year, you should receive a letter or email from each of them, telling you what each 'pot' of money is worth. The two older ones will grow slowly, the current one will grow faster because you and your employer are making monthly payments. Record the values in the spreadsheet. It takes 5 mins a year.

You have another 25 years of contributions and compound interest, so don't worry too much yet.

Just focus on getting your spreadsheet set up, and finding out the value of each. Details in a previous post show you how to track down old pensions.

Another option is maybe move somewhere cheap/abroad?

I'm not sure a defined benefit pension would show on online banking, mine just showed a pot value for defined contribution.

There also retirement flats for over 60s I think

Speak to a professional as soon as possible, this is too important to get wrong and you still have time to fix it.

Sorry @Ineffable23 and @Snoopsteandcooper i meant it is defined contribution. It’s definitely that. What does that mean for the 2,400 I can currently see on my online banking?

Yes, as I said it can vary from late 20s to over 40 years. It clearly says that if your NI record Started before 2016 you may have been contracted out and it means you usually have to pay in for more than 35 years. Not always but usually. It is bei g contracted out that makes it variable.It then says If your NI record Started After 2016 you will need 35 years.
I dont think it can be explained any more simply. What I said is correct. It is there in black and white. If you choose to interpret it differently fine but probably best that you don't give advice to an already confused OP.

I can't think this is right... Call your pension provider and get it all explained to you.

You have to be very careful when considering what healthcare is available abroad.

I would probably do a lost pensions search, sort out any paperwork that you may have, have a good read of it all and then get some free advice from the Pension Advisory Service