To think we are heading into a pensions disaster

[She11y]

I asked ChatGPT what the median pension savings were for someone in their mid 40s and I got the below reply:

Ages 35 to 44: The median pension pot is approximately £30,600.
• Ages 45 to 54: The median pension pot increases to about £81,200.

This website has a similarly sobering statistic - average pension pot for 50-59 is £96k.

https://www.nutsaboutmoney.com/pensions/average-pension-pot-uk

These are averages and the number will be brought down by some people who have zero pension savings but it's still a very low amount.

How are people going to survive retirement. There aren't many jobs for people the wrong side of 50z

Yep! I don’t think anyone realises that you need to save a pot of £800k to give you an income of £25k, pre tax. You have to start young and pay in a lot to get there and realistically, the cost of living is too high for most to be able to do it all.

51 and my pot is 26,000 I’m fucked. Never been able to save into a pension while a single parent then a parent trying to pay uni fees etc. never a good time for me.

I don't doubt that when my generation (millennials) reach retirement age there is a very real shitshow coming, but I just had a thought - how do those averages take into account those of us with a defined benefit pension, as we don't have a pot.

Those DB pensions are going to have to be reduced at some point in the near future. They have over a trillion liability which will take an ever higher share of the tax take to pay.

It could even work out as a vote winner for whichever party brings it in, even more so seeing the average size of private sector pension pots posted above.

Why would you prioritise uni fees over a pension?!

I think lots of parents would

Also a lot of people won't be mortgage free and will still be renting

For heavens sake why?? They can get a student loan which is paid back in a reasonable way when they’re earning. Being a penniless pensioner for the gamble of a degree is ridiculous.

Surely she means living costs not uni tuition fees? Who on earth pays tuition fees up front?

Fees can be via the loan. Paying up front with no pension is madness.

Government employees are still having great pensions. At the expense of all taxpayers in the future. Our DC are truly f-cked. Millions of people don’t have decent pensions but will be paying for platinum ones for others.

The loan isn't enough to cover their rent let alone any other living costs.

100% we need to look at the public sector pensions.

Lots of us made peace with the fact we will go from work to coffin. No retirement age by then. By peace I mean we just resigned to it. With beer in hand

That's the very top of the range of what you'd need for that income. It depends at what age you retire how big a pot you need, the older you are when you retire the less you need but the more time you've had to save. Also, that's on top of your state pension (currently £11.5K). Also, you get 25% of your pension tax free. Finally, an income of £36k would make you very comfortable as a pensioner, especially if you were married.

They should get a job then.

I’m a relatively high earner and I am only just about to contribute to my pension. My employer has been paying 10%, but I need to start putting in significantly more.

It will be a worry for a lot of people who have prioritised house deposits, rent, paying for childcare and a high cost of living.

To be honest I know a few pensioners with pretty much nothing in private pensions who have ended up barely needing any money. Mixture of house paid off, pretty much 0 council tax, state pension and pension credit, don't run a car, attendance allowance.

The importance of compound interest should be drilled into young people's minds. I started saving properly at about 30yo. If I'd done it at 20 then I'd be a lot better off. But still, I'm hoping to hit the lifetime allowance by retirement age when accounting for 6% growth YoY. That said, my pension has gone down by £9k in the past two months 🙃

Well yes and no. I think if you asked a lot of folk to reduce down to £35k a year, quite a few would scoff at that number. The most important point is that I don’t think people realise how much you need to save to be comfortable. State pension age is also already at 67 and will go up.

my plan will be to live on my lump sum until state pension age, if all goes to plan.

It isn't an option for some courses where they have to do rotations as part of the course. The loan amount is very outdated now rents have increased so much.

Well obviously I wasn't referring to the tuition fees, I meant the accommodation, living costs etc

What kind of courses?

They should take out the loan for tuition fees and top up the rest with a part time job. Most uni students go to lectures or study for about 4/5 hours a day, the majority have plenty of time to work.

Facepalm at your attitude. Some degrees are so full on the student would compromise their outcome by working part time. That really would be pointless if they then failed

A lot of the current generations need to ‘keep up with the Joneses’ will certainly come back to haunt them in later life - the expensive cars on finance, stretched themselves with Mortgage’s for the big house etc. Even a extra £2/300 a month directed at pension/investments would
make a huge difference.