I’m 58 and I have this much in my private pension

[elsaandanna]

I have £75,000. In a Nest Account
My chances of retiring early are not looking good.
I genuinely did not understand the principles of a private pension despite being self employed for 30 years.
These things should be taught in schools!
My mortgage is paid off and I have about £8k in a rainy day fund.

I wish I hadn’t looked now.

Agreed it is way too low to allow an early retirement but at least you now know and can do something about if so when you do retire.... you have a good standard of living.

Schools can't teach everything.
The best advice I got was a simple statement from my Ddad when I started work and that was to start paying into a pension ASAP.
As I got older I understood more about pensions and I realised that although I was in-line to be comfortable, I needed to pay in more to enable an EARLY retirement.

Have you checked your state pension forecast?

Rebel Finance School explains everything you need to know about pensions. Mine is doing significantly better than it was after doing the course. I learned how and what to invest it in.

You’ve got no mortgage, don’t downplay that achievement and how much security that already gives you in retirement.

You also have something in a pension, that’s better than nothing.

Two questions: are you eligible for a full state pension, and what do you need/want annually in retirement?

I don’t know much about pensions. What about self-employed people like the OP? They obviously don’t get any employer contributions. Does the government act as their employer and contribute in the place of an employer?

No (other than the tax relief) but self employed people pay less NI, so there are swings and roundabouts.

No other pension. A lifetime of self employment.
The mortgage money goes to savings/ pension .
I will get a full state pension in 10 years.
I don’t want to put my savings in the pension although it’s tempting. I may need it for a boiler/ roof/ other household disaster

I have considered looking for an employed job, not just for the pension.

It is taught in schools. And in the 40 or so years since you’ve left school you’ve had opportunity to learn new things, enabled by the financial and actual literacy that school taught you.

I’m going to be another voice recommending the free Rebel Finance School you can absolutely improve your position and this course will give you the tools to do it. Anyone can do it.

It might be now but I am of a similar age to @elsaandanna and I can assure it wasnt when we were there! Its only in recent years that the education system has caught on to the fact that kids need more than just academic education.

What a nasty and snide remark.

You just need to start bunging all your available cash into a sipp. nest is expensive with high fees. There are a few free pension providers now - trading 212, Freetrade and I’m sure there’s another. Go on martins money saving and look at the comparison table, find a global tracker and off you go.

im also self employed and i agree pain but on the other side you have total control over the platform and fund and fees so there are benefits too

I can understand not being able to calculate compound interest or understand how an annuity is calculated from a pension pot if you struggled with maths, but this sounds more like you just didn't think you'd have to put much money in? What did you think the principles of a pension were? Were you always expecting to retire early, but didn't realise the feasibility was tied to how much you'd saved?

Obviously, you don't have much money to retire early on, but there are better ways to prep for the future that you can still take advantage of. Lot's of good advice on the Internet, including here.

I just don’t know what I was thinking about pensions, nothing probably. My mother never lived long enough to get hers. My father was on disability benefits ( wheelchair user). There was no example of hard work and savings to follow. No internet with helpful forums! I grew up in an area of deprivation.

I had children and was the classic sandwich generation, looking after them and my father. As soon as the kids went to Uni I had a wake up moment that there was no plan for me. I took out a Nest Pension and I’m paying into it every month without fail. I am self employed so my income has varied from month to month and it’s made it hard to budget.

Ive always worked. I have tried to save (but not in a pension)

What younger MNers may not know is that work place pensions were optional years ago and that when every penny counted it seemed like an optional expense.
I really needed someone to sit down and explain money to me. But life happened.

I make a point to tell younger people than me that pensions, savings, writing a Will and getting a Power of Attorney are essential.
I have dipped into Rebel Finance school. The mesage seems to be cut back on expenses and buy shares in an ISA?

Ive recently gone through my outgoings and cut back as much as I can. I’m stuck with a very basic Sky Tv package until January 2028. This is the last thing that needs to go. SKy won’t budge unless I pay a cancellation fee.

I can see why people buy lottery tickets now.

OP,
I don’t think this is what you want to hear but retiring late (after pension age) did wonders for our finances.

I understand it but dwelling on it isn’t helping you. So go back to the rebel finance videos and open a sipp. Transfer the nest one into it. No point in an ISA now

You have 2 bedrooms- can you monetise the 2nd one? Options include big commitments like having a lodger, through to doing old school Air BnB or even renting the space as storage. There are companies that connect people who need a bit of extra space and will pay a small amount to store a box or two of personal belongings. It wouldn't be much, but you could bung it in an ISA.

Another option would be offering it as a craft room or art studio space or home office for someone without one.

Great ideas! If you live near a university (or perhaps even some secondary schools) they might pay for you to host international students or visiting staff for a few weeks/months at a time so less commitment than a lodger.

What we would have been taught at school 50 years ago might not be relevant now. Everyone needs to educate themselves about pensions, but it's understandable that years can go by without that.

Schools have other things to teach. Do you genuinely think 16-18 year olds are really going to take this on board. There’s plenty of information out there for people to educate themselves financially.

If you've got some savings (depending on the interest rate) you could put them in Premium bonds rather than buying lottery tickets 😊

Hi OP, I am around your age same generation. You are so right about lack of pension advice when we were younger. Luckily my union did outreach work on this and I did additional contributions for a while. That was literally luck because someone at my union spotted this problem and their decisions helped me and lots of others.
I think you have done exceptionally well considering the many issues and challenges life has thrown at you.
I expect you are attached to your home, I know I am to mine, but if you dont need a two bedroom property there may be some advantage to be gained from downsizing.
By the way you dont mention any health problems, if you dont have any you are doing very well, not one of my friends my age including me, is free from these annoying bastard things!

I agree with others about using that spare room, also finding a job with a salary. Hang on in there!

OP: how much are you earning now & how much are you spending each month, what is the net you manage to keep adding to savings?

How much of your spending each month is work related, like professional license or equipment or insurance?

Sorry I’m a bit clueless, you have 75,000 saved up as a lump sum, but will you be getting a pension payment every week also?

Is that not enough? Again sorry for the stupid question I’m not in the uk so I don’t know how much the pension is weekly.

Another idea is to open a stocks and shares isa and invest in some etf funds .. nest is a pretty good pension provider and have out performed a few others. Read as much as you can about long term investing and have balanced pension, isa and stocks and shares isa. 3 pots makes a difference to tax implications.