To be worried it’s just not possible to save for a decent pension if you’re on a normal salary, have a mortgage and kids/DC?

[Onegingerhead]

Seeing all these pension threads lately has got me properly worried. I’m mid-late 40s, been paying into a workplace pension for about 15 years and my pot’s around £70K.
From what I’ve read, you need roughly £250K to get the equivalent of the state pension. So if I manage another 20 years of work (big if), I might get there… but that still only gives you about £12K a year. Enough for bills, food, and maybe new underwear twice a year when the old ones give up 😅
The thing is — how are people managing to save more? Someone on another thread said they’re putting in £2.5K a month and I thought, wow, that’s incredible… but totally out of reach for most of us. My job doesn’t pay badly but it’s not great either, and I am professionally qualified. How do I do this?
For context: roughly £100K in your pension pot gives you around £4K a year in retirement income. So £250K = £10–12K. Not much to live on if there’s no state pension left.

So what’s the answer?

AIBU — you can build a good pension even on an average income, just got to be smart?
AINBU — realistically, unless you’re on a high wage, it’s almost impossible to save enough for a comfortable retirement?

For your average person, you can get the advice you need to invest your money effectively online.

Using a professional will cost money, and they will suggest exactly the same things - maxing out your ISA etc.

You don’t need to seek professional advice in all scenarios - same reason I don’t need an accountant to do my tax return for me, I can do it myself.

Information and guidance online, yes. For you to make your own decisions.

Not advice.

Your workplace pension fund should offer you a range of funds, and you can change accordingly.

Exactly - premium bonds and overpaying the mortgage aren't investments.

Also given that mortgages are the cheapest debt you have and there are tax advantages to stuffing your pension and then taking it out as part of your tax free allowance to pay down your mortgage.

I don't think it's worth worrying about it too much, keep adding to it and it'll work out.

My mum dropped dead at 67 and her mum was even younger. I'm not expecting a long retirement. If I make it to retirement age, the mortgage will be paid and my small pot + state should be enough to keep me warm and fed.

Are you forgetting the compound interest over time? You don't have to make £250k of contributions.

My work pension was compulsory from age 21. At the time I resented paying a large amount, but had no choice. 30 years on I am so greatful for a comfortable retirement including full state pension. Being forced to pay, you had to cut your cloth when young and fit. I would have definable paid in less when kids were small, but glad I was. It given the option. Now we are allowed to live for today and pensions come last. Do agree it is much harder for next generation and do help financially

If you really want to prioritise your pension then have you considered employers which have a really good pension?

I’m in the civil service - I pay in 7.35% but my employer pays in a massive 29%. It’s a defined benefits scheme so I look at the amount I’m expected to get rather than the pension pot but if I stay in the civil service I’d be getting a pension of very close to my current (comfortable) salary. I don’t think I’d be able to get close to that through savings.

It gets easier to put more in once your kids have left home and your mortgage is paid off.

This 100%.
I couldn't join a pension scheme until I was 24. I did as soon as possible. I started work aged 20 in 1980 and invested 50pcm into a mip. I opened one a year for three years. Each of them.paid out about £10k ten years later. They were a super cushion when I had young children. One bought the swcond hand family car when I gave up work for 7 years.

From 24 I was in the pension scheme, receiving double my contributions from the employer and I maxed it. I appreciate I am an anomaly but I was interested. I went back to work aged 43. No point then transferring pension into the LGPS because my earnings were so low compared to my private/vested pensions. Aged 53 I changed employer, still LGPS and my earnings had caught up. I tranferred everything over and bought the equivalent of 20 years linked to the FSS scheme. Happily promoted a couple of times and my pension will be excellent.

Our DC were in pension schemes from day one of work. If you start investing immediately, it's money you never miss. I agree with you wholeheartedly.

I'll admit that I'm usually quite dismissive of personal finance podcasts but if that's the one thing you took from it then hats off to Katie and Ala (whoever they are!). 'Bung as much as you can in a low-cost global equity tracker' is pensions advice that will be suitable for the great majority of 'normal' people.

I really would check out your works pension situation as if it's a typical defined contribution scheme it would be very odd indeed if you had to invest in bonds on pain of losing your employer's contribution - it just doesn't make sense to force employees to do that and tbh seems like it could be a breach of the scheme trustee's/managers fiduciary duties.

The reality is if you weren't well off in your working life you won't be well off in retirement.

But its ok. If your retirement expenses are low (no mortgage/ rent, no dependants, small easy to maintain/ heat home) and hobbies cheap (volunteering, gardening, cooking etc) it could be lovely.

Yes, I totally get this. I actually feel quite empowered after going through the Rebel Finance School — it really helped me understand how things work in general.
My main issue now is just not having enough spare money to invest, and at my age I probably need to be a bit more aggressive with my savings. I’m thinking of starting a SIPP for that reason.
With my current employer, I pay in 5% and they add another 10%, which is decent. My previous employer only paid 3%, hence my pot is pathetic. I’ll try to find out how much flexibility I’ve got with the funds there

Until DC leaves home and unless I manage to get a better-paid job there’s not much more I can do, really. We live in a very modest 3-bed (well, more like a 2.5-bed, as I use the box room as my office). If DC wants to stay with us for a while, downsizing isn’t really an option.

Yes, I’ve heard that the 4% drawdown rule is on the cautious side, but I’d rather plan for the worst-case scenario than be caught short later on.

Well from what you say you didn't start paying in until you were over 30? Just as a comaprions i have been paying into my private pension since I was 17 and have always paid into any work place pension in all jobs. Thats a minimum of 13 to 15 years of contributions I've made before you started paying in. I have always prioritised it and would rather pay into my pension than have a brand new car every 3 years with a payment of several under a month.

this times 1 million

i started paying when I was 31. I really couldn’t afford it before. And my car is 03 reg lol. Still drives ok-ish, so no, I never splashed money on flashy cars and brands. 😂
I was aggressively saving for a house deposit in my 20s.

@Ilovemyshed 100% agree and that's what I've done. Started JISAs and had conversations about the importance of investing early when they turned 18.

DD is in her first job which has a DB pension and is contributing to her ISA.

I started investing very late due to a complete lack of knowledge and awareness but I'm making sure she doesn't make the same mistake.

Y2 primary. Loooooong way to go

I'm 48 and never earned enough to have a pension. So

I'm 48 and never earned enough to have a pension. So

@Wiennetta do you know at what age you can take your db pension?

DD is training to be a teacher so has a DB pension. But it's linked to the state pension age so I don't think she'll be able to access it until age 69 (she's 22). Her contributions are also quite high imo and I don't think the scheme is as good as in the past.

She's also saving into a SIPP and ISA so she can retire well before 69.

I was never on a particularly high wage for saving (in my opinion anyway — I know some Mumsnetters think £35K a year is loads 😂). Plus, I thought, well, I do pay NI, so at least I’ll be getting a state pension one day (I’ve got 23 years of contributions so far).
Back in 2010, when I first started paying into a workplace pension, I was on about £30K, and when I left that job in 2022 I was earning £39K. I’m on a bit more now, but still in the basic rate taxpayer bracket

I highly recommend doing Rebel Finance School free course. I'm in same boat, 45 with around 70k saved and am no overly concerned after doing the course.

I dont have a pension, also dont own my own home. I'll be working until I drop down dead so I can house and feed myself. Have no other choice.