How much in your pension?

[Petpank]

I'm a SAHM & DHs pension is doing pretty nicely... just logged on to my account online for the first time however - and had a wake up call...There's £26k. Suddenly that doesn't sound very much. Not going to last me very long.

House will be paid off in a few years - but we have live...

Is it just me? Feel like a bit of a fool for not addressing it much sooner.

I got back into the workplace at 32 didnt have a pension scheme before children and now have about £500 in mine. Im working till i die arent i? Im now 34

Are you taking full advantage of your employers pension contributions now Coverup?

No need to work until you die but you do need to kick start your retirement planning sharpish!

www.pensionwise.gov.uk/when-you-die

Thanks Gloss.

My employer even admitted their plan was crap when i started but i only work 5.5 hours a day mon to fri at just above minimum wage. Im in a pretty sorry state at the moment as i have no savings either. It does worry me alot.

Did they say why it was 'crap' is it their contribution that is rubbish? Even if it is just 1 or 2% that's at least something.

Coverup, assuming you are earning over £10k then it would be worth doing the auto-enrolment which is what I guess your employer is offering. Based on qualifying earnings, the amounts paid to pension will be tiny but it's a start.

You can then focus on things like paying off debts, having around 6 months of living expenses saved. Then you can look at investing more into retirement.

Will you earn more in future? Now things may not look good but in 5 years it may be completely different.

Im trying to get more qualifications my children are getting older so things will change. I am lucky to have a job that fits round them at the moment. I have only just started at this job a few months ago the other was nights on zero hour contract.

The woman who works with me looked when he said in his words the pension was rubbish at the interview.

Sorry for hijacking its just somethibg that worries me. Dp has no interest in saving or anything so its just me who worries.

Coverup they need to be careful. The anti inducement legislation came into effect in July 2012 so employers can be fined for discouraging employees from joining the pension.

nannynick not all employers use qualifying earnings they may use one of the three 'sets' (previously known as tiers). coverup would also benefit from the pension even if she didn't earn over £10,000. However, her employer may not have staged yet, in which case this is all a moot point.

I'll work until I'm at least 75. It's the only solution.

I'm semi retired and have about 9k a year pension and work 2 days a week, I will probably do that until I am 66 and get my state pension. DH works full time but is expecting to retire in about 4 years on a good final salary pension.

Gloss - can you elaborate on why you think this is the case?
Investors should be cautious of any lifestyling strategy strategy. Lifestyling was designed for the annuity market, not the drawdown market.

My understanding is that it's generally considered a good idea to have moved your pension pots away from high risk, more volatile, investments into lower risks bonds, gilts etc as you approach the age at which you want to retire?

What's the alternative? To switch to Income funds away from Acc ones as you approach retirement instead?

Jng it was widely accepted as the right method, as the most common way to draw pension benefits was via an annuity. Pensions freedom and choice has changed that.

If you are going to stay invested and drawdown income, why would you spend 10/15/20 years de-risking?

A lot of peopl aren't even using their pension as a retirement vehicle anymore! In which case lifestyling is even less appropriate.

If one is still planning on taking an annuity, lifestyling is a very sensible strategy. There is also an argument for lifestyling if someone is taking the whole amount out as cash.

It just isn't as simple as 'lifestyling is a good thing' anymore.

Jng1 If you buy an annuity, then you have a pot of money when you are 65 to give to an insurance company. They take on the risk o investing. They promise to give you an income for life, with its value based on the amount of the pot (and other things). If you had a higher risk fund at that point and the market went 20% don the day before 65, you would have 25% less money for life. Hence the recommendation to move to lower risk as you approach retirement.
The new rules mean you do not have to buy an annuity and the risk can remain with you. You therefore potentially have longer for the fund to recover the value and re-pay you more money.
However, an annuity can still have its place in retirement and no-one should make a decision without a full understanding of their own position and lot of research/independent advice.

Gloss/Carol - ah yes, I see. In the past you had a very narrow window in which to buy that annuity didn't you, which meant if it fell in a market trough then you were scuppered if you were heavily invested in equities.

Actually, I think I confused my Vanguard funds anyway, as I've just checked and it's actually the Lifestrategy 80% Equity I have a lot of my pension in. I remember now looking at the Target Retirement funds but rejecting them for the very reasons you mention.
Thanks for flagging up my error!

Interesting thread.

DH and I don't really have a pension as such.
I used to work for the inland revenue and have a final salary pension. I have asked for a forecast but it won't be much.

DH has two pensions from previous employers totalling about 15 years of contributions. For the last 12 years DH has run his own LTD company. We just try to save as much as possible every month. We have a second home which we will rent or sell to provide an income. We also intend to downsize to release funds from our home. Hopefully along with savings this will give us around 700k by the time we retire.

We had intended to use this money to buy an annuity but we are no longer sure if this is the best plan.

Vanguard Life strategy is not a life styling fund of the type being discussed gers, it doesn't move investments as you as at all. I bought the 60% accumulating one in my SIPP and Vanguard don't know my date of birth (or even my name!) so they couldn't do that anyway.

It's a confusing name but it's not the same as the old type of life styling funds which I agree are no longer relevant.

*discussed here

OutToGetYou - no, that was my point I think. I looked at the Target Retirement Funds which WERE like the old lifestyling ones i.e. reducing exposure to equities and switching into bonds/ gilts etc as you get closer to retirement, but then, for the very reasons other posters mentioned (i.e. that I was no longer locked into buying an annuity with my fund) I decided to go for the Lifestrategy funds instead.
They are low cost funds of funds, which allows you to diversify across geographies and sectors and decide how much of your investment you want tied up in equities.
Difficult to know what to do at the moment investment-wise. I feel we're heading towards some seismic changes in politics/markets in the near future... My personal feeling is that the markets will begin to fall after Article 50 is triggered, once everyone realises that Brexit is actually going to happen, and it begins to get ugly in the negotiations

Jng1

Yep. Markets are high, but I am 48 and I have always felt we were on the edge of a seismic change in politics/markets :)

The one thing I would say is to look at how much your platform charges for holding each thing. I have started to move away from Vanguard as my platform wants 1% of it, so now I buy ETFs, which means a bit more work as I have to do my own diversification.

Ha! Yes, me too.... Repeat after me, "it's time IN the market, not timing the market..."

I'm with Interactive Investor now which is a flat rate cost of c. £200 per year with 8 trades included. On a bigger portfolio it works out a very low percentage.

I found the Lang Cat platform 'heat maps' really helpful for working out my best options: www.telegraph.co.uk/investing/sipps/in-tables-the-cheapest-sipp-firms--whether-youre-investing-5000/

Wheatchief, are you married? If you were to divorce, he could have half your pension.

I have a large amount in a pension fund from by a previous employer (was there 20 plus years, much of this on generous final salary scheme). I got a quote last year because I wanted to see if it would be worth moving it to my new employer (it wasn't). The quote was just above £500k which was a pleasant surprise BUT (big but) there is a very strong chance the company won't survive and the fund would then be administered by the pension protection fund. I saw an advisor who said one option would be to withdraw the whole amount and manage it as a private pension - but from the figures he quoted the sense of doing this was totally dependent on whether my old firm goes bust - if they don't then much better to leave as is. I'm still thinking about it ..

I'm 50.