Pension freak out

[SilverDoublet]

Hi, so I'm mid 40s, was a SAHP for 8 years and wasn't able to save into a pension then. I had only just set one up in my early 30s, but after wedding, buying a house and having kids it all fell by the wayside. Now I'm realising I'm approaching 50 with barely any pension saved. Maybe €12,000 across a few pension pots. Now I have got a job and want to start piling money into my pension, as much as possible, to catch up. My husband is telling me not to bother, that we need the money for a new kitchen and other upgrades to the house. I'm capable of living extremely frugally to save, but he just wants to spend and enjoy life. Is anyone else in this situation? I'm terrified of being penniless in old age.

Even if anyone has the kindest, nicest husband in the world, it is still very important to contribute to your own pension for BOTH your sakes as my husband and I are finding out now.
I have considerably less pension than my husband. My husband has several pensions but is not taking them all at the moment as this would put him into the higher rate tax bracket. I do not completely use up the lower tax bracket so it would have been better if we had more even pension contributions.
I was a SAHP for a while and my husband paid into my ISA so he is reasonable. It would have just been better for our joint finances if we had more even pension pots.

As far as I’m aware a pension doesn’t automatically form part of a person’s estate - so this would only be true if he named the OP as the beneficiary of his pension.

This is something you should clarify with him OP.

If the OP is in Ireland (which I suspect) we don’t have have access to the Vanguard SIPP here.

If anyone has a recommendation of a similar product available in Ireland I’d love to hear about it.

This is not accurate as in death it is not usual for the remaining spouse to receive the full pension from the deceased. Sometimes there is a spousal pension but not for the full value that the spouse had been receiving.

If any 20/30 somethings are reading this thread and thinking of becoming sahps - if you do, make sure the earning spouse puts half available for pension funds in one in your name!

The maths is quite tricky on this though!

I am an additional rate tax payer and so I get much more tax relief at source than my DH (who pays no tax most years). Then that additional money compounds over the years. I have never really understood at what point it becomes financially advantageous to lose the additional tax relief but gain being in a lower tax bracket on retirement.

I do give DH plenty for his ISA investments but he has no pension savings. He'll be eligible for the state pension if that's a thing by then.

I’m presumably your DH worked whilst you were a sham? What’s his pension looking like? Does he have enough to give both of you a good retirement?

I’m sure men do this because they are then in a more powerful position if something goes wrong. If a woman has a good pension she might not need him. Thankfully I have always prioritised pension contributions over kitchens. It’s not great to start having to scrabble for a pension now but better late than never!

When I turned 18, my dad booked me an appointment with his financial advisor to talk pensions. The adviser was amused and basically said make sure I paid into one, but wait until I finished uni and was working full time. So I did. I’ve never earned huge sums of money, but I’ve always paid into.

My husband on the other hand is an idiot. I was telling him for years (he’s 12 years older than me) that he needed to sort his pension out. He was convinced he needed to do nothing as he was on a final salary pension scheme with work. Which would have been fine if he worked there for 30 years, but that would have taken him well past retirement age, and the company wasn’t exactly known for having many people staying til retirement age these days. Sure enough, he got pushed out a couple of years after turning 50. So his pit had never built up. He gets it paid out - a couple of hundred quid a month. I think he’s actually starting to panic now as he finally seems to be sorting something out. I think it’s too little too late. I’m trying to leave him but begrudge that over the years I’ve always earned less than him, have paid 50% of everything, plus all Christmas and birthdays for relatives both sides and our kids, did/do the majority of stuff with the kids, a good chunk of the house work and yet he’s likely to walk away with a huge chunk of my pension. I struggled without dentists etc for years as I couldn’t afford them, prioritising my pension, whilst he had me paying half of his dentist/mobile/optician's (I paid for my own of all these) & never gave a thought about retirement.

Don’t he like my husband. Get something sorted now - better late than never. Your husband is telling you it’s a waste, but if something happens to him or you divorce, what happens to you then?

Agree completely. I work with older people in benefits advice and gosh a lot of them have left themselves in an almighty pickle.

I would definitely start paying into a pension as soon as possible and as much as you can reasonably afford. I started saving into my pension at 18 and at that time it was a DB pension, and closed so I then paid into a DC. Took early retirement and was lucky to not get a reduction in the monthly payments. During this time DH had 6 years where he wasn't working but as soon as he went back we ramped up his contributions so that he could get as much as possible so his pot could grow quicker.
His pot isn't as big as mine but we're trying to rectify that, as he was like you and didn't want to be in a position of not having much money in retirement.

Very true. I think we had both forgotten about the extra tax relief my husband got. However, if I had a better pension we would have been able to get more of a cash free lump sum. My husband was over the maximum so he forfeited this.
I really rate having stocks and shares ISAs. When you start drawing down there is no tax.

Fully agree. I have a number of friends in their 50s/early 60s in tricky situations as they were SAHM for quite a few years who have struggled in the jobs market and now have relatively small pension pots now realising how dependent they are upon their husbands who have carefully built up their pension pots and assets in their own names. 1 friend feel trapped, 1 friend divorced and ended up paying thousands in legal costs left feeling that she got a raw deal as his wealthy parents are still alive and he has lots of ‘benefits’ to come in a very comfortable retirement.