Pension worry…help

[Pensionworry1]

NC’d for this…basically I was a sahm and had a late career change 5 years ago. I’m 40…My current pension is at 33k…projected at 240k. I’m aware this is not enough
now I do have a separate extremely small pension elsewhere and by that I mean about 1.5k per year once retired.

it’s also worth noting that I’m still at the lower end of my career ladder right now and have no intention on stopping here. My wage increases about 4.5%annually, my company pays 10% and I pay 5% (I can’t pay any more than this as I have a mortgage etc) I usually pay some of my bonus into my pension so I might put it all in going forward (usually about 8%)…is there anything else I can do? I suppose that’s it really isn’t it? Should I be worried? I feel like I should be 😩

No one? 😩

Wow! This was not a clicky rage bite thread…I’m genuinely worried. But thanks for your input! There was no need to be so rude!

I have no idea what’s good or bad in terms of pensions when I looked at my pension progression and projection I was barely hitting 25,000 a year(and that was with the state pension). Yes, that’s not awful but it’s not exactly great. I was just looking for advice. There was no need to be so harsh.

Is it a DC pension and the pot is currently £33k?

Look - you’re addressing it now, and you have plenty of years of work ahead of you. You won’t get a state pension for probably another 30 years.

When will you pay your mortgage off? This will free up money to invest.

What are you investing in? You can be quite high risk this far out from retirement.

You mention being a SAHM - are you still married / do they have a pension? As you should look at yourselves as a couple as well as an individual.

Oh OP some people think that if you have a job and earn money you’re not allowed to have any worries in life.

I’d put what you can into ISAs when you get spare cash. It’s more flexible than nominating a %tage. And they if your expenses go down permanently you can’t increase your contribution permanently.

I am not a pension expert but surely all you can do is put more in?

If you want more in your pension pot then someone needs to put more in and there isn’t any one else who will do that. If you don’t have the money to put more in then you cannot. Isn’t this just maths?

What a bizarre response.

OP’s question is entirely reasonable. That other people are worse off doesn’t mean she can’t ask questions about her own position - and with a £33k pot she’s hardly Jeff Bezos.

It sounds like you're doing what you can, you just need to push forward with that. Anything you can spare helps as it has 25 years to grow.

£25k is more than many, many people earn as a salary. Bearing in mind when you're earning a salary you've probably got other costs, (mortgage, pension, commuting etc), you're in an ok position. It's just so insensitive to claim you're in a bad position when, unless you are totally blind to society, you are actually very privileged.

Why don’t you have a good read up on pensions. Martin Lewis is probably a good starting point. What amount annually do you think you’ll need to retire on? How are you going to get there? Remember when you’re “young” retired you will prob want to spend more (eg on holidays) than when you’re older. Great that you’re thinking about this now.

Ignore that PP who has nothing to add.

Is the old fund in a place with low fees? You could look at moving it elsewhere if it is and review the funds it’s invested in.

Apart from doing that, the only other option is to pay more in. You really are lucky that you get such a high employer contribution but that doesn’t mean it’s not a worry.

If you can’t afford more currently you have only a few options, do nothing, earn more ( could be a side hustle or a second job) or spend less. Have you been through all your bills recently? There might be small savings in renegotiating your phone bill or internet and put the extra to your pension?

Have a look at the funds you are invested in. How are they doing? Most providers have a range of funds showing the risk grading and past performance. You may want to switch (depending on your risk appetite).

I'm not really sure that is a lot anyone can say. Obviously as the first response shows lots of people have no pension, but £33k at 40 isn't really enough. You need to increase the rate at which you are saving into the pension to get a decent retirement. £240,000 into an annuity is abut £12k per year in todays money.

£25k is now full time on minimum wage.

Bollocks. On that basis most threads on MN would not exist.

What do you mean by DC? Yes currently has 33k

Mortgage is new enough but hopefully it will be paid off in 25years. So i am assuming I will have no mortgage when I retire

The only thing I’ve learned over the years is that Martin Lewis recommends paying in half your age (I think that’s from when you’ve started?) so at 40 you’re putting in 15% which isn’t far off, but maybe your other pensions cover off that 5% anyway. Not sure if that’s still the advice?!

25k a year with I would guess no mortgage would be plenty for many people -although in 25 years time if that’s only partially inflation protected that might feel more like 15k now which is hardly living the high life so yes saving more

do ignore the reports that assume you need the equivalent of 40k a year just to get by - I have no idea what planet which are on these days

OP is not being unreasonable to ask the question or worry about this. People are allowed to talk about their own situation and perhaps not be happy with their own situation. There is always going to be people with less, but £33k in a pension pot isn't exactly huge and OP is right to be planning for her future now. Lots of us want more then to just survive in retirement.

I was a sahm when my DC were small. I am actually with a new partner now and yes, he does have a pension. And a good one, but I don’t want to rely on his pension. I want to rely on mine 😔

Full time minimum wage is £25k, so no it's not more than most people earn unless they have chosen to work part time. Average salary is £37k. Again, lots of us want more than the minimum in retirement.

Defined contribution. You need roughly £100k for a £5k yearly pension.

Alas DB (defined benefit ) pension have been elmInated except for public sector workers.

£33k DB is £33k a year. What a difference.

We are know starting to experience the problems caused by DB removal. You need a minimum of £500K DC pot for a modest standard of living. The average person has no where near that amount even if they save and contribute diligently. The mess is just beginning,