Twice your salary in your pension pot at 35

[Mushroo]

I saw this headline earlier from the Telegraph. Is it just me or is that crazy?

Do people really have that much saved up in their pension pot at 35?

Im 30 and don’t even have a years salary saved!

I'm there or thereabouts, but I'm not a high earner! I have £40k in my pension at age 34. I've tried really hard to save as much as is feasible but it's just not enough. I'm lucky though as DH is a higher earner so his pension is decent and we do have a house (although it's mortgaged) so hopefully overall we'll be ok as the mortgage is due to be paid off by the time we retire.

Looking at annuity rates is absolutely depressing to be honest when you're saving as much as you can and it still seems like it won't be enough.

I think I might have £20k and I'm 38! That's only for the past 10 years give or take so it could be worse. At this pace I would retire with £80k in the bank

I defo don't but then my wage has trebled in the last 5 years so it would be tricky to keep up with that.

It's double my old salary 🤣🤣 better than nothing isn't it?

I have a DB pension and I've got about 2.5k in AVCs. I'm 36.

I wasn't referring to his teaching pension, I was referring to self invested pension.

You’re not in the Uk I assume? You can’t cash in a teacher’s pension here, there isn’t a ‘pot’ so to speak. If you’d been paying in for less than 2 years you can claim back your contributions, but that would certainly not be anything near £25k

Blimey, he must have lived off nothing for the last 5 years if he’s saved that much from a starter teacher salary!

I am 33 and moving to £34k salary next month. I currently have (checked earlier today) £44,600ish pot.
I opted out of pensions when I was younger but do regret that with the £1000s I’ve wasted over the years. Then Contributions at age 27 of 9 %…seriously began contributing around 30 years old.
It will depend on investment performance. My employer contributes 12 % - £340. I but possibly could get to £68,000 by 35.

As of this month, I started contributing £837 a month plus ni relief of £126. Employer will contribute £340. So £1303 total a month.

18 months to 35 years of age…but hoping there is a bit of a better return on investment and it will be much higher than £68k.

Annuities are not recommended nowadays

I’m 47, and have a defined pension which I’m currently receiving a small monthly payment from. But it isn’t index linked until I’m 55, and with inflation they way it is and likely to be for the foreseeable, Even the small amount I receive is getting less and less in real terms. My other pension pot is currently only 2.5k and is increasing at the 5+3% minimum, so it wouldn’t be much cop at retirement age.

@Soontobe60

No I'm in the UK and yes you can cash it in (ie apply for early retirement with triviality age 55+) under certain circumstances. Unfortunately for me I was not in teaching after March 2000 so I'm not entitled to take it. But it would have been about £25k.

These pension forecasts always seem to be on the high side. I think a lot of people who could retire hang on from fear of not having enough. Just put what you can away, whilst carrying on living a little.

How on earth can we possibly prioritise our pension when housing costs so much?

That’s exactly why people need to start paying a % of their wages into their pension from day 1, before any housing costs are committed to. It has to be money you never had.

I heard the half your age advice as a percentage a while ago. Only I misunderstood it. So I've been increasing my payments every year to ensure my percentage is always "half my age"!

I used to do it in April when any (tiny I work for a charity) pay rise came through and the personal tax limit increased. Now that's frozen.

It's paid off. I have almost 3 times my age in my pension pot.

I have been saving since 2002 though.

But you don't need to buy a pension anymore. You could self manage and take £10,000 Pa for 10 years (risky!) but the capital would still grow and with any luck you'd have the state pension too.

I'm a few years past 35 but I have about 4 times my salary right now. But I do work part time and work for charity so not great salary amount in the first place!

@YellowHpok

I think you should be okay on the taxation front - the tax value is 20x the annual value so 400k not £1M yet - so you have a good way to go.

It's a great pension though - that's what the annuity information is trying to tell you. Lots of people don't buy annuities any more, but if you did you would have to have saved up. £1M to buy an inflation linked one (or that's their assertion). If you assume a 4% drawdown rate instead you would have a pot of £500k.

I'm also public sector and have twice my salary in my pension pot by the age of 30 - but also, if I worked outside the public sector I could add 20k+ to my salary with ease. The net is that I earn slightly less in the public sector even given the value of my pension but that's a cost I'm prepared to pay because I value working for the public good.

I think modern pensions are utterly crap

i have an old closed define benefit pension that is worth about 350k - I had that by about age 36. Since then my additional sipp has 180k and it is very slow to grow

i am 47 and so have about 500k in my pension and I worry it’s not nearly enough but it seems not that bad compared to some

Annuities are on the rise as interest rates go up. They may well become a very attractive option before too long! This is particularly the case if you have a health condition which can increase the annual payout.

They have also become much more flexible - it's possible to opt for time limited annuities to bridge the gap from your retirement date to the start of the state pension payout.

Pensions are savings with additional tax benefits - and they are much less restrictive than they used to be, thanks to the pensions freedoms legislation.
Your additional Sipp will have grown by at least 20% of your savings amount, just from the tax relief alone.

Where else can you get an instant 20% increase into your savings?