to think too few people worry about pensions ...

[redskyatnight]

Was chatting to a group of friends (and friends of friends) the other day when the subject of pensions came up.

Only about half the people there (all in their 30s and 40s) had any sort of pension. Quite a few of those said that they didn't pay in as much as they ought to.

Of the others, the reasons for not having one varied from - not wanting to think about it, assuming the kids would support them, relying on inheritance (!), wanting to spend their money now and let the future take care of itself etc.

Maybe I am unduly worrying (I was in the "have a pension fund but don't pay in as much as I should do" group) but I'm astounded that so many people have effectively closed their eyes to saving for their old age. The state pension isn't going to be much to live on, and can we really rely on other sources of income just materialising from nowhere?

I do appreciate some people genuinely have no money for a pension after essential bills, so am talking about the people who do have disposable income but choose to spend it elsewhere.

Yes I could, but it will mean that my contribution to the household is even more shitty than it already is

TBH I am looking at the employed route and once they are both at school I will try and get a job with a company with a decent pension scheme

That sounds like a plan. I was a bit concerned when you said "I will never have a pension pot"

I think as a self-employed person it's really tricky actually, unless you are earning a decent amount

I pay the basic NI contributions - can't remember which ones, class 2? - although you can't pay extra (SP2) if you are self-employed. It's weird and illogical and I don't understand the point of not being able to pay extra if you are s.e......

There is a pensions guru on here isn't there...is it Someguy?

Yes, Leningrad I think as the law stands you currently can.

Age Concern were at the high court yesterday to try and overturn this but they lost.

I think they'll get about £130 out of it... but it's not their only pension, mum has a few years of teaching from before i was born and dad had about ten years at one point from before he went self-employed... and they have ordinary savings too.

not sure what they're going to do about annuities vs. investments from now on but dad had an accountant when self-empolyed who appears to be giving good advice.

My DH is 47 and has no pension, worries me sick.

I'm 33 and I think he figures I'll keep him in his old age. I'm in the NHS pension but only work p/t so I worry about not having enough. Will probably go full time when DD older though.

DH gets his old scheme Forces pension when he leaves the Navy in 3 years time, so we'll have pension and salary as he'll only be 40 when he leaves and will continue to work.

I also have a small old scheme Forces pension I'll get at some point (can't remember when, need to dig out the paper work). I need to set up something more substantial though incase DH dies or we divorce.

I still panic about it though and we are reasonably OK pension wise.

IIRC 100,000 will buy you an annuity of around 6k

You might get a better price if you are in rough health - so I might take up smoking and whisky drinking when I am 62....

So relly you need a pension pot of 200k, to buy yourself a 12k pension

So if I have 30 years of working life left, then I am going to need to save 6.7k per year to get a pension of 12k a year

But at the mo, I only earn 10k a year

So where's my incentive? If I save 10% of my earnings, I'll have a pension pot of 30k, which will buy me an annuity of about 2k a year

I'd be better off just getting a cleaning job when I'm 65...

I think pensions are in general rubbish investments. If you don't smoke or ride pillion on a 1000cc motorbike three times a week, the annuity you are going to be offered for your hard-earned pension pot is going to be rubbish. I honestly think you are better off foregoing the tax inticement and investing the money yourself in vehicle that does not require you to purchase an annuity at the end.

Final salary pension shemes are marvellous for the few that have them. But they are v unfair where they exist for a small tranche of the workforce and are closed to others.

inticement enticement

Lenin - You could buy a house or flat for £50,000 or £60,000 and rent it out for £300 -£400 per month as income, so not forego your personal tax allowance. And you would still have the asset to pass on to your children once you pop off.

If I could find a house for 50k I'd buy one! Cheapest near me (northern cheap area) are 90k. We even looked at Hull and Middlesborough to buy an investment property and couldn't find anything that cheap.

We need a Live Webchat with a pensions adviser

I think it would be very useful to have an extra £40 per week from a personal pension on top of the basic state pension of £95.

That extra £40 would make a big difference to your standard of living

you are right