How big is your pension pot?

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PetersMapProject@reddit

If you're employed, it's a legal requirement for your employer to be paying into a workplace pension scheme for you.

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You miss the point. For a pension to be hundred of pounds a month, you have to be earning A LOT of money. My salary is 3x the average salary and I still only pay £180 a month into my pension.

People need to learn a bit more about pensions and the tax relief they bring.

I would agree that those on minimum wage may be struggling and the extra £70 a month is make or break for them

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Ok-Morning-6911@reddit

That's not necessarily true. I only earn 39k and pay a 17% pension contribution. 8% from me and 9% from my employer. That means my part costs me 3,120 and my employer 3,510. So even factoring in tax relief it's more than two hundred per month from my take home.

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Informal-Method-5401@reddit

That’s a high contribution, I’m assuming you’ve opted for that or not bothered to reduce it? Nonetheless, that percentage is not the norm.

Great contributions from your employer though!

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Ok-Morning-6911@reddit

Yeah, we can choose what percentage we contribute, but they will match and add a bit extra the higher we go, so it's worth it for us to go higher. I need it to be honest because I only started the pension in my mid 30s so have lots of catching up to do.

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pr0ph3t_0f_m3rcy@reddit

You've no idea what financial commitments they currently have though.

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'know much about AI' and it's someone who's read a lot of sci-fi schlock.

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LetMeBuildYourSquad@reddit

Not at all. The vast majority of people working in AI believe it poses some degree of existential risk. People like Goeffrey Hinton are not just talking about science fiction.

The average AI researcher thinks it has around a 20% chance of leading to human extinction.

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lol it’s my opinion?

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Matthew94@reddit

And it's silly.

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Pellellell@reddit

Ok cool 😎 I’d love to have more faith in our financial system

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asdf0897awyeo89fq23f@reddit

Looks like you've got plenty of money for plants though?

civilisation will probably break down before I’m old enough to get it

Fun fact: during the cold war, the majority of people thought there would be another world war within 10 years.

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beih13@reddit

Pension companies charge you a percentage from your “saved” pension money. They charge you for “managing your pension”.

You re better off putting a side some money into a good saving account, every-time you get paid. Than letting them “manage” your pension.

It’s a different story if its worth saving at all rather than investing. But still you are better off with saving account than paying them

When your employer registered you for pension, and you did not opt out, look into it. Read and check what percentage they charge for managing your money ;)

Also, you will get a state pension anyway. Regardless if you re in or if you ve opted out. Deductions from your salary for pension is a separate thing to state pension.

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antiqueslug4485@reddit

Your bank also makes money out of your savings. It is not a free facility.

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PetersMapProject@reddit

Pension companies charge you a percentage from your “saved” pension money. They charge you for “managing your pension”.

It is good advice to tell people to check if the pension provider is charging higher or lower fees.

It is terrible advice to suggest that the existence of fees means you shouldn't invest in a pension at all.

Let's not imagine that banks hand over all the money they make from the money you deposit with them. They take their fees - the pension funds are just more transparent about it.

You re better off putting a side some money into a good saving account, every-time you get paid. Than letting them “manage” your pension.

It’s a different story if its worth saving at all rather than investing. But still you are better off with saving account than paying them

There's several reasons why this isn't true.

Pensions are investments, rather than savings. Investments typically perform better than savings. My pension has averaged 12% growth over the last five years, whereas you're lucky to get 5% interest on a savings account.
Your pension contributions are tax free, whereas your savings come from your income after tax. Every time I put £100 into my SIPP, it instantly turns into £125 due to the tax relief.
With workplace pension contributions, your employer is required to add contributions - this is a legal minimum of 3% of your pay, but it's often more.
The gains on pensions are tax free, whereas the gains on non-ISA savings and investments are taxable.

When your employer registered you for pension, and you did not opt out, look into it. Read and check what percentage they charge for managing your money ;)

I have, thank you. My pension investments have still grown much faster than my cash savings.

Also, you will get a state pension anyway. Regardless if you re in or if you ve opted out. Deductions from your salary for pension is a separate thing to state pension.

Only if you pay national insurance contributions, or were eligible for NI credits. You need either 30 or 35 years worth of contributions to get the full state pension.

This can present an issue for people who earn very little, some carers, and other people who took extra time out of the workforce for any reason (e.g. people who spend longer than average in higher education).

aliceinlondon@reddit

Receiving “free money” in 40 years that they do in fact need to pay for right now

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DanielReddit26@reddit

Or people on lower wages who want/need all the money they can get now as opposed to in 40 years time...

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Reactance15@reddit

This is another hidden cost of being poorer.

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realGilgongo@reddit

Coincidentally, I was just arguing with somebody about how when you you're poor the odds are stacked against you (eg paying monthly for bills is more expensive than yearly - that crap should be illegal). I forgot about workplace pension enrolment, but it's a great example. So many things are cheaper and easier once you have a small execess of income. Before that, you're just in quicksand the whole time.

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MyAccidentalAccount@reddit

While this is true, you can contribute 1% and get the same amount matched by your employer, a 12k Salary would mean £240 a year going into your pension while you only "lose" £120.

I appreciate that even 1% of a minimum wage income might be better used now rather than after retirement, but I'd always advise that you should start paying whatever you can afford into a pension as early as you can. This is very much a "do as I say not do as I do" - Learn from mistakes of others ;)

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C0rneliusTalmage@reddit

One additional correction to your edit: the minimum total contribution for auto enrolment is 8%.

So if employer contributions are at their legal minimum of 3%, then employee contributions need to be 5% (including tax relief).

Yeah that is an issue, I'd still look at your options though, their minimum is 3.5% but you can still contribute to a private pension any amount you can afford and get tax relief on it.

You wont get the employer contrib, but its better than nothing.

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Spicymargx@reddit

This is great advice thank you!

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srm79@reddit

For some people they'll get a pension paying out about a tenner a week and then lose their ability to claim pension credit and all the extras that go with it like rent and council tax support, winter fuel allowance, free prescriptions and eye care, etc., you have to be very careful at the poorer end

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Yeah I feel it was dodgy and unlawful myself getting him to opt out. When I found out this year I got him to opt back in. It's a drop in the ocean when, his debt is twice his current pension at 63 having not yet having reached 5 figures and still not eligible for full state pension. Apparently people with poor financial literacy make poor, uninformed financial decisions and when things go wrong they try to hide the problem.

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PetersMapProject@reddit

I was including them in the latter category.

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TooStonedForAName@reddit

Hi buddy, it’s not free money if you have to spend money on it - it’s interest. Some people can’t afford investments that come with interest. This is where the phrase “you have to spend money to make money” comes from. Hope that helps :)

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PetersMapProject@reddit

You have failed to account for employer's contributions - which is a legal minimum of 3% of your pay, and often higher. If you opt out, you never see that money. The employers contributions really are free money.

The money you put in is also tax free - which is like getting 20% extra free.

Savings attract interest, but pensions are held as investments - mostly stocks, shares and bonds. They do not attract interest, but they do (usually) rise in value - and that rise in value is usually much higher than interest rates. My old workplace pension has risen by an average of 12% every year for the last five years (and that includes the 2020 crash).

It's ok to be young and not understand pensions, but I'd suggest doing some reading before young you screws over old you.

Hope that helps :)

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Fragrant-Reserve4832@reddit

Not all pension scheams have company contributions

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PetersMapProject@reddit

If you are employed - and outside a narrow range of exemptions, like being under 22 - it is a legal requirement for your employer to contribute to a workplace pension scheme unless you opt out.

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DanielReddit26@reddit

Yes, they have to contribute 3%... That leaves 5% for you to contribute to meet the 8% minimum.

If you're on £25k, that works out as £83/month off your takehome.

Unfortunately, some people can't afford that regardless of how that £83 gets grossed up, added to, and then makes investment gains.

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PetersMapProject@reddit

Those people are going to struggle even more in retirement than they are now.

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DanielReddit26@reddit

Well that depends upon their life trajectory, on the whole I don't think anyone is disputing that though but again, unfortunately, they can't sacrifice what they do not have today for better tomorrow's.

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I'm not sure I follow this.

If you pay into a pension and your employer also contributes into it you still get interest on the amount in the pension, the employer isnt paying the interest on behalf of the bank - you get both.

What am I missing?

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2xtc@reddit

Doesn't matter if you're young or old, you're still a rude and condescending cunt.

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MattCDnD@reddit

Only those who can afford to eat today deserve free money!

The “absolute morons” that can’t deserve to starve tomorrow.

Such a great view on the world you have there!

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anunkneemouse@reddit

I've been one of them. It isn't idiocy to be poor and not able to afford a pension. It's poverty. There were months I couldn't afford repairs on the boiler or car, so I had no chance at putting 4% away for the pension. Different story in recent years where I have been earning a strong salary (except recently, when I was made redundant at work! Yay, capitalism)

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DanielReddit26@reddit

Not very kind of you.

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Bethlizardbreath@reddit

I remember when they brought this in. I was working in a big department store with famous Christmas adverts. Myself and my colleagues in our department were pretty much all <25.

The majority of them immediately opted out to save the monthly money.

This guy is the “let them eat cake” of 2024 Britain.

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Isgortio@reddit

1490 over 2 years is just over £50 a month, which you'd probably lose to tax anyway. So you're not actually seeing much of that money if you opt out of the pension.

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LinzSymphonyK425@reddit

Well, if you're in the situation I was in when I was a freelance music teacher 25 years ago, then you can't afford even £25 a month. I used to go right down to the wire every month before payday - no slack at all.

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cloud__19@reddit

To be giver, you're coming off a bit of a prick here, it's not about delayed gratification, there are people who genuinely cannot afford to lock their money away in the here and now. I understand perfectly why it's a good financial decision but that's irrelevant if you need to pay for your rent and food and heating and there's nothing left over. I'm in a fortunate position myself but I can summon up enough empathy to see why people chose to worry about tomorrow later on.

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PetersMapProject@reddit

I really don't care if the truth makes me sound like a prick.

A lot of people simply don't understand pensions and opt out of the pension contributions not because they need the money for fundamentals, but because they want slightly more spending money now. I've seen young single people with minimal living costs opting out before now.

This is how you end up in a situation where the winter fuel allowance is make or break for you.

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scuderia91@reddit

But that’s not everyone that opts out, that’s one group which you’re using to malign everyone who’s opted out

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PetersMapProject@reddit

Absolutely everyone who opts out will lose out in the long run.

Even if you die before you reach pensionable age, your family will inherit the pension pot.

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scuderia91@reddit

But the point is some people will lose out on the short run. How can you tell some to go hungry today in the hopes they’ll have a pension at some point in the future.

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PetersMapProject@reddit

Most people opting out of pension schemes aren't actually doing it because it's that or going hungry.

They want more money to spend on non-essentials now, and fail to think about how they're going to pay for essentials in old age.

A lot of people simply don't understand how pensions work either, and opt out through ignorance not genuine necessity.

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scuderia91@reddit

What are you basing that on? Or are you just making it up.

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PetersMapProject@reddit

Experience and observation.

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2xtc@reddit

What a load of pretentious cuntish nonsense

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AskUK-ModTeam@reddit

Don't be a dick to each other, or other subreddits, places, or people.

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cloud__19@reddit

But I'm not presenting the case of people who have minimal outgoings. I'm presenting the case of people who genuinely can barely manage the basics. They are not morons or poor at delayed gratification, they're just poor.

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Double_Jab_Jabroni@reddit

Do you realise how out of touch you sound? Not everyone can afford to use that £1,490 to invest. If you don’t believe that, you haven’t got a damn clue about the financial position a lot of people find themselves in.

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...and very low income people who can't live right now with any more deducted from their income.

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What an awful, cunty thing to say to someone.

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AskUK-ModTeam@reddit

Don't be a dick to each other, or other subreddits, places, or people.

You not seen the state of the country?

That £20 contribution doesn’t mean shit if you can’t afford to eat, which ever increasing numbers of people are struggling to do.

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I'm dead serious.

Its market cap is as high as Saudi Aramco. Its literally considered more valuable than oil in terms of global economics.

I've been invested since 2018. Paid 37% down on my first house in 2022.

Portfolio is currently 4000%.

If it went to zero tomorrow I've still had more profit out of it than I've invested to date.

But it won't. There is a reason countries are moving to a BTC reserve standard. Bhutan, Costa Rica, Brazil. There's a reason some of the worlds leading hedge funds are offering BTC ETFs.

I don't think I'm the uneducated in the conversation. I don't mean that offensively. Genuinely.

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phaattiee@reddit

Not if you have even the slightest accurate comprehension of economics and the way the technology works.

There is a reason its $100k per 1BTC and has a market cap that's overtaken Saudi Aramco.

Its literally more valuable than Oil.

Within the next 3-4 years it will be worth more than Google.

Yet my post will get downvoted because people can't comprehend the simplicity of what it represents.

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blob8543@reddit

Economics and investments are not simple. That's your first mistake.

Being unable or unwilling to read charts is your second mistake.

Look at the bitcoin to usd chart of the last 5 years. Check what happened after October 2021. BTC went from being worth $60 to $40. I remember many crypto bros saying at the time that was a great time to buy before prices recovered and what happened next? BTC went down to $20 and after half a year it managed to reach $30. It took almost 3 years for it to get back to $60.

More recently, BTC would have crashed if Kamala Harris had won in November and there's a big risk of it crashing if Trump takes many stupid decisions when he takes over.

It's no better than gambling.

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PoliticsNerd76@reddit

If you opt out, you have chosen to be poor come old age

And this is why opt out shouldn’t be an option.

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Queen_of_London@reddit

If you can afford it, you could get a private pension with a small minimal monthly payment,. It's what I got when I was self-employed and I've kept paying in to it. The govt tops it up by 25% (up to a certain limit, I think - not looked into that heavily because it's a much larger amount than I'd pay in per year).

Might not be the best idea if you have other essential things to pay for, of course.

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PetersMapProject@reddit

You can earn minimum wage and still make the workplace pension contributions, and get the employers contributions.

So long as you earn at least £520 per month (approx 45 hours per month at minimum wage) then your employer has to contribute to your pension, on top of your wages.

https://www.gov.uk/workplace-pensions/what-you-your-employer-and-the-government-pay

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Lucky-Maximum8450@reddit

Holy shit what?! 520 a month? I earn more than that but when ever I even try to contribute.. even the bare minimum to my pension, it tells me I can't because my wage will fall below legal minimum wage.

Is this wrong lol:( Should I ask payroll or something

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jubza@reddit

There's two kinds of ways an employer can contribute to your pension. There's one that most people have which is post tax, you would definitely be eligible for this. Then there's salary sacrifice where you basically give up a portion of your salary and your employer puts this into your pension saving tax for both you and themselves. You cannot salary sacrifice below minimum wage.

I'd definitely get in touch with your finance department, this is too big to ignore.

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Lucky-Maximum8450@reddit

Thank you so much for confirming, definitely will try to get this sorted. It has been at the back of my mind for a while now. I'm 28 and have around 17k in my pension pot from a precious job 💀😭 I know I'm still young but need to start making better plans for the future

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vario_@reddit

Does this count for zero hours contracts? I've been at my job for 10 years and I've never heard of it. I only make £120 a week so I just assumed I didn't make enough to have one.

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PetersMapProject@reddit

I didn't expect this comment to blow up quite as much as it did, so I didn't go into exhaustive detail, but £120 is the threshold below which an employer doesn't have to contribute to your pension

https://www.gov.uk/workplace-pensions/joining-a-workplace-pension

Unless you fall into a very narrow range of exceptions, like being under 22 or earning less than £10k a year, your employer is breaking the law

Been self employed for the last 25 years.

I have three kids. Never miss a bill payment, but every penny goes on life.

I'm guessing nearly everyone in my situation has the same dilemma, refuse my kids luxuries and have a secure future, or give the kids what I never had and work till I die.

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sanbikinoraion@reddit

Give your kids the luxury of not having to worry about you in your old age. Set up some automatic monthly payment and treat it like any other bill that needs paying. You can start small, just throw £50 or £100va month into a SIPP, LISA or even premium bonds.

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Brutal-Gentleman@reddit

What if all you have left over after bills is £50-£100?

Let me guess, less coffees and avocados..?

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rumblemania@reddit

The pension contributions would come out before tax so you’d be left with much the same amount

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Brutal-Gentleman@reddit

Nope.. If I put £100 into a pension, I do not get £100 in tax back

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rumblemania@reddit

You’ll be pretty close if things are as dier as you say

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Brutal-Gentleman@reddit

That literally makes no sense.

The standard rate is 20% tax relief, so I would be £80 worse off now for putting £100 aside.

Yes, I'd be better off in 30 years.. But I grew up with fuck all because my dad was frugal, he's got a great pension now, but still an arsehole who scrimps.

I'm giving my kids treats now, because life is too short not to.

"pretty close".. No way

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covmatty1@reddit

refuse my kids luxuries

I mean, obviously this, and stop being financially irresponsible.

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asdf0897awyeo89fq23f@reddit

It actually just means you'll be ensuring those kids have to look after you in your old age. Directly or from their taxes.

For a demographic that complains about boomers so much, there are a lot of people in this thread expecting the next generation to pick up the slack.

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Outside_Yellow5002@reddit

Haha if it gets to that point I'll be taking a long walk off a short cliff. My retirement plan!

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Arxson@reddit

The problem is that there will be far more retirees than working people. This is already happening. So you can expect the quality of your retired life to be fed some sort of gruel twice a day, and maybe they’ll change your adult diaper once a week.

Or, you could start saving for your retirement!

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Less-Information-256@reddit

Haha if it gets to that point I'll be taking a long walk off a short cliff.

I'm sure your kids would appreciate that approach.

And what's the problem with being looked after from working people's taxes? Will have been paying them for 50 years at that point anyway.

For balance, my house is 'lived in', I live in a shit area, drive a 15 year old non-luxury car, and generally live frugally.

Things that have made a difference for me were starting young, making sacrifices to build the early capital, and moving away from default funds to more risky (but mainstream) investments.

Age 32, about £15,000. Never paid into a pension until my current job (which I've had for about four years now) I was initially only working part time and paying in the minimum for the first two years but have gradually ramped up my work hours and contributions over time (currently 12% me and 12% my employer goes in, around £480-£560 a month in total, depending on how much overtime I do-I'm thinking about raising my contributions further next year).

I was unemployed for much of my 20s due to mental health issues (I've had clinical depression for 20 years and had a especially rough patch a few years back, it's been a very long and difficult road to get to where I am now), and the jobs I did have were mostly temporary or didn't offer a pension scheme, so although I know I'm very behind for someone my age I wasn't really in a position to do much about it until recently. Honestly know very little about how pensions/finances work, but I still live with relatives so my bills/expenses are relatively low so I'm relatively lucky that I have time and the ability to catch up a bit.

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twaticasblack@reddit

It may have been a rocky start, but take a second t o appreciate how far you've come. That's an impressive upwards journey on all accounts!

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paulmclaughlin@reddit

The rule of thumb is that you should contribute half of your age when you start investing into a pension as a percentage of your income, if you want a pension that is about 2/3 of your salary when you retire.

So if you've already got some in there now, and you're paying in a total of 24% at age 32, you should consider yourself to be on track now.

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BigDumbGreenMong@reddit

The only way it's realistic for most people is to start as early as you can. When you're young, you might not have a lot of cash but you do have time on your side.

Time can turn a little bit of cash into a lot of cash.

Am 51, and like a lot of people my age I really wish I'd started caring about my pension 30 years ago instead of 10 years ago. It's the difference between being a rich old retiree, or having to work until you die.

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Tiny_Major_7514@reddit (OP)

Definitely - a tale as old as time. And I knew it then but still didn't do it.. when you're young being old just seems so far away

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AvoidFinasteride@reddit

Definitely - a tale as old as time. And I knew it then but still didn't do it.. when you're young being old just seems so far away

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I am very lucky my first 'proper' job at 21 paid a 12% pension with no employee contributions required. Someone i worked with still opted for the cash!!

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BigDumbGreenMong@reddit

Hah - Full Moon Party on Koh Phangan? Same same.

Nothing wrong with enjoying life and having some fun experiences, but I definitely spaffed money on stuff I didn't need and didn't even add a lot of value to my life at the time - it was just spending out of boredom. I probably could have still had plenty of fun, and put some money aside for old age.

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Sage-Freke-@reddit

In case you didn’t know about LISAs (Lifetime ISA), you have from when you turn 18, until the day before your 40th birthday to open one and then you can contribute up to £4k per year into it and the government contributes 25%. Then you can contribute every year until you’re 50 and start withdrawing either when you buy your first home or when you turn 60. It also gains interest, like with any other ISA.

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AndyVale@reddit

The general approach is that the S&S ISA is for long term savings. That would be either something you need in 10+ years or failing that it's a bridge between retirement and your pension kicking in should you want to clock off early.

It can also function as an absolute last ditch "break glass in case of emergency" fund, separate to other savings pots.

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cowbutt6@reddit

You've funded your ISA out of your post-tax income, but the gains will be tax-free.

Meanwhile, pension contributions are funded out of your pre-tax income, but the pension you receive may be subject to tax, depending on the value and tax rules in place when you claim.

You can access the funds in your ISA for whatever purpose, whenever you like (though you can never regain the tax advantages for any such withdrawals). Pensions may only be accessed from legally-mandated ages.

Probably the best reason to prefer pensions is for the employer contribution, especially if it is more than the legal minimum. It's not uncommon for some employers to offer 12% contributions, or more, given a minimum employee contribution. If you can afford to do without the value of that employee contribution in your monthly pay, maximizing that employer contribution is free money (in the long term).

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Austen_Tasseltine@reddit

In money terms, and as long as you accept the money is locked away until minimum pension age (which for you will be 57), pension is the ideal way.

The tax relief on your own contributions means each £1 into your pot only brings your pay down by 80p (basic rate taxpayer) or 60p (40% rate), or less than that if your employer does salary sacrifice for NI savings. And of course there are the employer contributions too. There simply isn’t an alternative vehicle that turns 80p from your salary into £2+ of savings, and any investment promising returns to beat that will be at best ludicrously risky.

Drives me mad that qualifying earnings and the fact auto enrollment doesn’t start till 23.

Simply don’t give them the choice. Again, Australia have done this and it’s fine. Post tax, the impact on the poor is marginal, but it actually allows the poorest to accrue net worth and will close inequality over time.

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audigex@reddit

“Force them to starve” doesn’t seem like a viable option

Australian minimum wage has been about 10% higher than the UK for ages now, although admittedly is more like 5% higher at this point

But even with the current 5% difference… 5% sounds an awful lot like a pension contribution

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noddyneddy@reddit

way back when, I was doing A levels and my economics teacher said ' I know you'll think I'm being a boring old fartbut really, start your pension as soon as you possibly can and take advantage of the miracle of compound interest'

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Snoo-84389@reddit

So did you start one?

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noddyneddy@reddit

Yup joined the pension scheme as soon as I could in my first job. Contributed in every job and then more as I hit higher rate. Got a sizeable pot by now!

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anjunableep@reddit

Politely: no. I used to think this and that, being in my forties, I was waaaay too late to the game to save any significant amount for retirement.

But compound interest and ETF's are a magical thing.

Say you invest £1,000 every month for ten years. Then assuming 10% interest compounded monthly (the low end of my current returns) you will have \~ £205,000 at the end of that time. This is approaching an amount that you could retire (frugally) on.

That's just ten years. Invest £2,000 / month and you'll have over £400,000.

I appreciate £1,000 / month might be a lot for most people, I'm just pointing out that investments can grow surprisingly quickly and it's never too late to start.

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OkIndependent1667@reddit

I was fortunate to get a wake up call in my mid 20s

We had cleaners in the shop i worked in who were both in their 70s the guy always looked in pain and was slow to do much (of course we all helped where we could) but one line made it all clear to me

“Yeah that’s a shit pension looks like”

Immediately bumped my contributions that day to the max that i could afford, its not the best but now i’m hoping the compounding interest will start to kick in over the next 30 years

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BigDumbGreenMong@reddit

I saw a video about this on some YouTube personal finance channel - compound interest looks kind of pointless for a long time because maybe you can only save £20 a month, and by the end of the year the interest is barely enough to pay for a beer. And it feels like that for years.

But slowly, gradually, your pot snowballs; the interest grows, the amount of money you can save grows, and then you find yourself in middle age and you're earning thousands of pounds in interest every year.

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sobrique@reddit

Yeah. Was about 40 before the rate of 'pension growth' started to outpace my contribution rate. (15% ish per year, including employer contribution).

AndyVale@reddit

They say it's one of the best and most selfless things a grandparent can do. They'll probably never see the benefit but it can be absolutely massive.

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Handy-Wallhole@reddit

It's the difference between being a rich old retiree, or having to work until you die.

Yeah but if you can go back in time you can just change everything

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811545b2-4ff7-4041@reddit

You may need to take a trip to r/UKPersonalFinance

Sure.. you've got kids with clothes & trainers that cost more than yours, that desire 'good brands' to keep up with the other teenagers, pocket money and requests for more 'going out' money, transport to school costs, lunch money costs.. family holidays cost more because there's less 'kids' discount, eating out costs more because they eat more than I do.

I'm sure it's far less than full-time nursery fees though! Well, until they get to uni, then we'll be looking at £600pm+ , but more likely more, for about 6 years (2 kids, 3 year gap between).

So.. by the time I'm 52 both kids will be through uni and I can relax!

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MyAccidentalAccount@reddit

We're still in the expensive teenage years too, I could probably work part time if the kids were out and working :)

I'd still advise speaking to an FA if for nothing else than confirming what you've worked out, worth it for the small fee to get some peace of mind in my opinion :)

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sobrique@reddit

How recently did you talk to them?

Because annuity rates have increased dramatically in the last couple of years, which is often the estimation basis - if you were retiring today you'd need about half as much to buy a £50k annuity.

My pension forecast of 'retirement income' has increased by nearly 100% as a result. (With of course, substantial 'error bars' based on it still being 2 decades off)

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MyAccidentalAccount@reddit

Its been a while to be fair - I've been overdue for review for ages.

Good news though, sounds like I might be more on track than I thought :)

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edcoopered@reddit

"limiting the pension contributions to invest elsewhere" you might want a different financial advisor.

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MyAccidentalAccount@reddit

Yes and no.

Its not advice for everyone, but in my situation it was right, I had around £200k in savings with some coming from inheritance and the plan had been to dump the whole lot into the pension.

The pension goal I had was 50k a year after retirement, requiring around £1.8m in the pot, even with the 200k I'd need to make contributions of around £1500 a month to achieve this.

The advice was to invest the 200k elsewhere, between my partner and I we now have 3 flats owned outright, bringing in £1500 a month which after tax I think worked out at around £15k a year.

Investing that 15k a year back into the pension along with a £500 contribution from me would give me £2m+ in the pot when I retire.

Now getting back to whether this was good advice or not... £2m is more than £1.8m, and £500 is less than £1500 so I now have a potentially bigger pension pot and more disposable income than if I'd just dumped the money into the pension.

With the added bonus that I still have £200k in assets that I can sell and release the money from should I need it before I retire.

Another bonus, that £1500 a month rental income. That doesn't stop when we retire.

However as is the way, the implementation of the plan is a a little different as I realised our goals had changed, what we actually decided to do (again with FA advice) was not to re-invest all of the rent into the pension, we're using it to pay off our residential mortgage with the plan being that I'll be mortgage free and semi retired in my mid 50s. My partner is pretty much there now at 46 - she works by choice rather than necessity AND I'm still on track to meet (and probably surpass) the goal of a 50k income in retirement.

Without the FAs advice, I'd have an extra 200k in my pension but I'd still need to make a £1500+ contribution every month to meet the goal, I'd have much less disposable income and would only be retiring in my mid 60s.

You may disagree, but I think its panned out quite well so far - and as I said, if it all goes tits up that initial £200k is still there, we can still sell up and pay it into the pension.

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Sad-Bag3443@reddit

You have no way or knowing how much you will need to live on for how long, so don’t stress.

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CwrwCymru@reddit

"4% rule" isn't a bad benchmark. Of course nothing is certain but you can absolutely plan with reasonable certainty.

tl;dr - save 25 times your predicted annual expenditure in retirement and you'll be able to live off this for at least 30 years. Include state pension to make the numbers less scary.

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GlasgowGunner@reddit

And remember in general your retirement expenditure is probably quite a bit lower than your expenditure today.

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Puzzled-Barnacle-200@reddit

In some ways yes, but other ways no. Ideally you won't be paying rent or a mortgage, and won't have childcare costs. But you might want to support your adult children, more free time means more entertainment, and you might need to pay for many of the things you do now eg, cleaning, laundry, mowing the lawn, painting etc.

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sobrique@reddit

Yeah. Of those, the mortgage is the real breakpoint as far as I'm concerned. The pre-tax 'equivalent salary' that mortgage or rent 'costs' is huge.

Retirement isn't an age, it's a financial state. The pot is only half the 'picture'. 'somewhere to live' is the other half.

Yeah i'm in my mid-late 20s and people keep saying 'don't compare yourselves to others' which is perfectly fine until it comes to finances in which comparing yourselves to others is ABSOLUTELY necessary. The further you are away from the median the closer you are to not retiring ever. Or going homeless, etc etc

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RodneyRodnesson@reddit

However - don't compare yourself to others - just make sure you plan properly for your own needs. The best time to start saving is today.

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munehaus@reddit

Those numbers by age are most likely due to the fact that private pension pots weren't really a thing until the late 1980s, so anyone over 50 will only have contributed since then, at best.

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TrueGaucho@reddit

I am almost 39 years old and my pot today is £302k. I have always earned well, with my earnings increasing exponentially in the last 4 years (successive pay rises to discourage me from leaving plus some large annual bonuses). I started out at age 24 (when I joined my current employer) paying 10% of my gross salary into my salary sacrifice pension (no employer contribution) and I have gradually upped that percentage to the point where, since the beginning of this year, I now put 25% of my salary into my pension. It’s something I am really proud of - and also pleased because my wife (who gets paid a lot less) pays 8% into hers, and currently nothing due to long term illness. I believe the fund my pension is invested in has performed particularly well over the years, which obviously helps.

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Dependent_Desk_1944@reddit

How can the average people save 210k at age 40 when so many just bought their house in their late 30s? It doesn’t really math. They must be really high earner for that to happen

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Vagaborg@reddit

£280 p/m increasing for inflation every year will get you to £200k in 20 years. Assuming 8%.

It's doable.

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Mystic_L@reddit

Not sure where you’re getting £216k from, the average for a 40 year old is more like 30k. But averages don’t really cut it here, it’s more about your own expectation on retirement.

Typically the (very simplistic) guidance is to be aiming for 2/3 of your salary as your yearly earnings from a pension. But this really depends on where on the income scale you are and whether you own your home etc. and adjusted up or down depending on your expected living standards after retirement.

r/ukpersonalfinance is a really good resource and has a load of guides on pensions and investments

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LondonCycling@reddit

Yeah came to say the same thing. That's not even the average retirement pot at retirement age.

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SorryForTheCoffee@reddit

That’s not even anywhere close to what you need for a basic retirement. We are all sleepwalking into poverty

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Vagaborg@reddit

Aiming for 2/3 of your salary in retirement is easily enough. The caveat is that you don't need the extra 1/3 to pay to your mortgage.

Or do you think op means 2/3 in total? No, that's perfect year.

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mathcampbell@reddit

Yep. I was self employed and living on tax credits or benefits or a student for basically most of my 20’s and large bit of my 30’s. Think my entire pension pot will be about £25k if I’m lucky and I’m 41. My partner is long term disabled so has basically nothing.

Expect to need about £1k a month minimum, for 20+ years. That’s like 240k.

I’m so screwed all I can do is pay what I can and hope I somehow don’t end up destitute cos we all know the taxes we’ve paid to give boomers a pension won’t be around for us in 25 years time…

solidpro99@reddit

45yo self-employed for 17y, 700k SIPP, 400k ISA, 500k BTL paid off, NI contributions complete. This is to cover two of us though. Prob working another 5 years then go part time. Still all in 100% equities so a few storms to ride out, I suspect.

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yocomoquchi@reddit

I’m one of the lucky few with a final salary pension and have also made max AVCs since I was 20. As things stand, at 55 I’ll have 37 years in the scheme and my projection looks like a lump sum of £225k and a yearly pension of £38k.

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President-Sloth@reddit

28 and ~145k, should be 220k+ come January

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Electronic-Sea1858@reddit

Where do they pull these figures from? UK average wage is £42k. Even if you left school at 16 and immediately went into a job earning £42k, and you saved 10% of that every year for the past 24 years, you'd be just over 100k. If your employer matched that, you'd still be under the 216k they quote.

For reference, I'm 32 and have about 5k in my private pension.

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Puzzled-Barnacle-200@reddit

Even if you left school at 16 and immediately went into a job earning £42k, and you saved 10% of that every year for the past 24 years, you'd be just over 100k

I'm 40 and I have £12k.

I was tried, and failed (at least in the financial sense) to start my own business, then I had a couple of jobs too briefly to really sort out my pension, then I did a PhD. I've been working for the university for 6 years since I finished my PhD and somehow only saved up £12k. It doesn't help that I "Officially" only work one day a week for the university - the remainder of my days are for a spin out. I put almost all of my 1 day a week salary into the pension now and it's still growing alarmingly slowly.

My ability to live on £3k a year (the current projected pension) is .... doubtful. I shall continue throwing lump sums in as we go.

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lactucasativafingers@reddit

You'll also get a state pension, presumably

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theModge@reddit

Well, I've paid my NI, so there will be something there, assuming it's still available when I retire.

Hopefully, having up contributions it'll be rather more than £3k/ year by the time that I actually retire. Also I'm in the fortunate position that I do a job that isn't going to destroy my body, so I can keep working longer

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GreenHoardingDragon@reddit

£45k at 35, should be around £185k by age 40, not adjusted for inflation.

Wife has £80k also at age 35, should reach £150k by age 40.

Total would be £335k or 2.5 times annual salary.

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Evil_Knavel@reddit

I'm nearly 40. Let's just say it's less of a pot and more of a small saucer.

I don't trust any of these pension schemes tbh. I think they'll move the goalposts the older the millenial generation gets, and then there will be an inevitable scandal where we all get cheated out of our money.

My advice would be to own property if you don't already, and then in my opinion your money is better spent overpaying your mortgage. Ask me in 30 years if this was a terrible idea or not.

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mcbc4@reddit

Turned 40 a couple months ago and £130k roughly.

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PoliticsNerd76@reddit

I’m in my late 20’s, and almost £100k

When you breach the child benefit cap and have a student loan, it’s just not worth powering through 70% marginal rates and you end up pension stuffing rises and bonus

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Old_Chef_4604@reddit

This is the way

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Imaginary-Ride2213@reddit

Nice work!

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b-a-l-winton@reddit

37, with £169k in the pension currently

One thing worth noting for those with a higher pension sum is the age of withdrawal raising in future (almost guaranteed) so a bridging amount in your ISA is a sensible stop gap measure if you want to retire before then.

I'm in a similar situation salary and age wise. My contributions are similar too however I'm adding £250 extra. What I've done the past few years is when April comes around and you (hopefully) get a pay rise, put part or all of the monthly increase as a voluntary contribution on top of what you're doing now. That way you feel the hit as much. Do this every other year and you'll soon build up a decent pot.

My friend had about 50k when he retired. He was back to work after a couple of years. He’s turning 70 now and hating it. He’s just so tired: he’s exhausted all the time. He can’t keep up with his younger colleagues so he’s constantly worried that he’ll be first to go if there are redundancies. He just wants to stop but can’t afford to.

That was a wake-up call for me - I think some people who say, “guess I’ll work until I die lol” don’t know what that actually looks like. He’s working in an office too - manual jobs would only be worse.

Awesome awesome job my dude. I’m £175k at 31 hoping to be at £200k at 32.

Is that 50 years old and 4 million?🤣

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thebuttonmonkey@reddit

I'm desperate to escape, but the wife won't have it until my daughter is grown up. My plan is to do 5 years in Ireland and get that passport, then explore the EU without restriction.

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Infinite_Crow_3706@reddit

For financial gains, I recommend the Middle East

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thebuttonmonkey@reddit

We had our daughter late and with current investments I’m hoping to be retired by the time she moves out anyway, so I’m planning to just… walk the land.

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Infinite_Crow_3706@reddit

It's good to be ambitious. I moved from UK to US in 2000, then to Middle East 2018 and Asia 2020. Back in Saudi now. I was a Chemist by degrees if that helps.

For my opinion, Europe is flat and uninteresting for work. Great for holidays but strangled by bureaucracy and lack of ambition in the general polpulation.

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Suspicious-Movie4993@reddit

I’m late to the pension party. I have about 89k in pensions but this year I’ve started salary sacrificing about 30k year in and will do so for as long as I can. I expect to consider retiring in about 6 years and not touch the pension for as long as possible and let it compound and leave it to my family.

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cayosonia@reddit

My pension plan is bank robbery. I am either getting a lot of money or a roof and three meals a day (will be too old.to be anybodies bitch)

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MyAccidentalAccount@reddit

I'm in a similar situation.

Most of my life I spent in full time work but with terrible company pensions so have around 8k in the pot of company pensions. Started working for myself around 10 years ago and have been putting 500 a month in (mostly consistently) since, as a result I think there is around £40k in my personal pension pot.

Though, not having much confidence in these actually performing any better than a normal savings account I have also been buying property, Currently between my partner (who has no other pension) and I we have three relatively cheap properties that we own outright and rent out - I expect that these will either be rented out when we retire to provide us some income, or will be sold and we'll live off the proceeds (Though I dont expect that they will appreciate much in value especially compared to inflation because of the type/location of the properties).

The best advice I can give you is to find a financial advisor to give you some advice on this as there are so many factors to consider - will you still have a mortgage? are you supporting anyone else (Ill be supporting my partner and probably my son who has additional needs).

My FA advised that for my situation I'd want about £50k a year, which would require £1.8m in my pension - that would need a pension contribution of around £1500 a month - which I'm no where near - mostly because I don't want to - I know it would help in the future, but I'd rather have that money now!

Not knowing what the state pension will be in 35 years time its difficult but at the moment our household income in retirement will be :

£9k My State Pension
£9k Partners State Pension
£15k Rental Income (Assuming that tax rates stay the same)
£??? Whatever my Workplace and Private pensions bring in.

So as you can see we're about 60% of the way towards the goal of 50k household income in retirement - Though inflation being what it is I think we probably need more now.

I suggest speaking to a financial advisor who will be able to go over your potential needs and give you some advice on how to get there.

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JohnnyC_1969@reddit

Started working for myself around 10 years ago and have been putting 500 a month in (mostly consistently) since, as a result I think there is around £40k in my personal pension pot.

The best advice I can give you is to find a financial advisor to give you some advice on this

I hope that £40K is a typo. £500 a month for 10 years is £60K with zero growth, and then there's tax relief added by the government too.

You should see a financial advisor as something doesn't add up here.

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MyAccidentalAccount@reddit

To be fair I said mostly consistently, first few years I wasn't paying in the full 500 and then there was a few years where it was being paid less frequently.

And while I do get tax relief, that's in the form of a reduction to my income tax at year end, it doesn't go into my pension.

Looking back at what I've paid in, consistently was the wrong choice of word :)

It's been consistent for about 3-4 years, sporadic before that.

Once I get home and logged into the portal I'll check what I've actually paid in vs what's in there now but from memory the growth was averaging 7-8%

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JohnnyC_1969@reddit

Thanks for the clarification. And, as they say, it’s never too late. I’ve started a pension in my early 20s (I’m 55 now). But it’s not until a few years ago that I even thought about retiring and realising I should have been putting much more into it. So now I’m trying to plough money into my pension pot. Like you I did start over paying on my mortgage so that’s something I did right.

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MyAccidentalAccount@reddit

So, I got round to checking and I was a bit off - Ive had the pension for almost 10 years but have only been consistent with it for the last 4!

Personal pension started in July 2015 but not paying in much It was just after I started working for myself so wasn't wanting to dump too much of the disposable income into it.

Then in 2016 I was working at Carillion when they went bankrupt owing me 30k so stopped paying in while I waited to get paid (which I did) but then I didn't re-instate the Standing order for the pension again until march 2020 and since then its been consistent 500 a month.

So not even close to consistent for the last 10 years! In fact it was pretty much flat between 2016 and 2020!

Looking at the dashboard I can see that averaged over the 10 years its actually closer to £300 a month I've paid in, but most of that has actually been in the last 4 years, in total I have paid in £35k and have 44k in the pot, so a little more than I thought.

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Proper-Promotion7412@reddit

Around £110k pure pension + £28k LISA (which will be used for retirement as already own house).

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CharringtonCross@reddit

Thanks. What seems harder to quantify is how much my kids will need for getting established (uni, deposit, car maybe) 5, 10, 15 years from now.

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Hot_College_6538@reddit

"please put on your own oxygen mask before helping others"

I've never seen anyone mention inheritance is taxed as income tax as well as inheritance tax. I can't see it on government website anywhere. Do you know where I might see it? As surely people would complain about that double tax for the recipient

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KILOCHARLIES@reddit

It’s only on pensions not any other assets at all. As such the new rules bringing pension pots under IHT means they may be actually punitive compared to other assets…

If you are 75 or over when you die, a beneficiary of your pension pot will have to pay income tax on any withdrawals at their marginal rate (i.e. the highest rate of income tax they pay).

26 and 20k. I’ve tracked down all of my previous workplace pensions and combined them into one, which wasn’t actually that difficult!

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Newreddituserw@reddit

70k same, sort of age

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Outside_Yellow5002@reddit

I think I've lived my life on a different level to most people.

If I've got 20 quid in my pocket I'm happy. If I want to be miserable I'll come and read this sub for 10 mins.

I'm 45, I've got 2 defined benefit pensions that are currently worth the equivalent of £750k. They grow with CPI each year and I'm still actively employed. If I work to 68 (which I won't), that will rise to £1.9m

My wife has a direct benefit pot of £350k, and a smaller private pot of c£100k.

We're retiring at 55 and not a day later.

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Codders94@reddit

£24k at 30. No idea whether this is considered to be a little or a lot.

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SnooMarzipans2687@reddit

42M | £460K split over 2 pots.

Have the (fortunate) burden of being a higher rate taxpayer. This creates the incentive to push my contributions to the max. This means I put away £5000 a month between me and my employer.

The main advice I'd give would be; - Start early. Even if it's a little. Compounding is incredible if you give those small amounts enough time to vest.

if you're young and have the option, change your pension investment into something on the upper end of "risk". This will yield a more beneficial outcome over time and ride out the volatility in the market. It's amazing how few people don't realise this and go with the default 3/7 risk.
personal one this, but it should feel uncomfortable in terms of the amount committed to your pension. This discomfort should increase the more money you earn as ultimately its more you'll save on PAYE taxes. I believe in the "die with nothing" concept, BTW - so it's a balance between living for today and planning for a comfortable future.

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alphahydra@reddit

I have a defined benefit pension, so I'm not provided with an actual total balance (or if I am, it's buried somewhere I can't find it) I just get updates on how much of an annual pension payout I've accrued so far, and a projection of what my annual earnings will be at retirement age.

I asked a question about the current value of my DB pension, and I got given this formula for working it out.

"Eg. if the pension is worth £4000 per year after age 65, and you are 55, then (assuming 7% growth):

£4000 x 25 = £100,000

£100,000 x 1.07^(-10) = £50,834 now, where the 10 in the second line is = 65 - 55 (years until retirement)."

Plug in your own yearly amount, years until retirement and a rough guess at the yearly growth rate to work out ((very) roughly) what the value of your pot is right now.

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Limp-Archer-7872@reddit

Multiple the annual payout by 20x or 25x for an equivalent or value for a DB pension.

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alphahydra@reddit

That's useful, thank you.

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scare_crowe94@reddit

29, 39k

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Sivo1400@reddit

Nearly 25% of UK population don't have private pension savings.

The ones that do, the MEDIAN pot is approx in 50s is 80K.

Most people work to the state pension age. Age 68+ for most people today.

You need to decide when you want to stop working. If its anything under state pension age where you can mix state pension and private pension, you will need enough to cover the extra.

So just say 80k from age 68. If you want to retire at 60, how much do you need a year for those 8 years to live as you want to live. 20K a year? Then you need to have roughly 240K in your pot by age 60. You also need to consider inflation. 240K in 20 years in equivelent purchasing power is about 400k. So you will need 400K by age 60 in this example.

In hindsight my comment was tetchy af

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Certain_Second192@reddit

I’m 40 and I have about £100k.

Self employed - you should be throwing cash into a pension for a tax break

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Total-Associate3537@reddit

Anybody doing the next pension through their employer? I have been doing it the past 7 years I’m not sure if it any good at all. But don’t know who else I could switch to? Anyone recommend any good pensions? 😄

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ijs_1985@reddit

I turn 40 next year

I haven’t looked at the pension pot from my 2 Previous employers as I needed the cash back then

I now pay in the maximum that is matched by my employer on top of their generous initial contribution

There is a few hundred thousand in there now with the aim of c£1.5m by 60

Intention would be take a lump at 55 if the rules haven’t changed

Any pay rise I get I always look to see if I can contribute slightly more to the pension pot without impacting take home pay ie put the 50% tax & NI cost into my pension instead

Wish I’d put more away when I first started working but I earn £12k and had a child at 23 so every penny counted

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jamesmatthews6@reddit

Hahaha the average is nothing like £200k. If I remember correctly the average at age 40 is more like £40k and a bit over £100k at 60.

Obviously those figures are nowhere near enough for a comfortable (as opposed to survivable) retirement.

So you're far above average, but that's more a symptom of most people not having enough.

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MonkeyPuzzles@reddit

Men in their 40s £36k, women £26.5k https://www.charles-stanley.co.uk/insights/commentary/average-pension-pot-by-age-uk

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NinjaSquads@reddit

I’m so f@&£ed with my £10k at 43 😞

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811545b2-4ff7-4041@reddit

From https://www.pensionbee.com/uk/pension-landscape

I think it's more like 'average pension pot estimate by 66' of £200K

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jamesmatthews6@reddit

Well still a lot less than £200k at 40 either way, but sources differ.

https://www.nutsaboutmoney.com/pensions/average-pension-pot-uk

Interestingly your link has different predicted pension pot at 66 sizes for different age groups now, ranging from £200k (the youngest group which I assume is what you saw) to £87k.

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811545b2-4ff7-4041@reddit

They don't really show the source of the research, and could be some inherent bias due to their methods, or could be the lack of inclusion of defined benefit 'pots'.

Look up Defined Benefit vs Defined Contribution pensions, the NHS DB is very good (by modern standards) , the private sector has pretty much phased out DB except a few industries, as it gets more expensive with life expectancy of course.

It's probably worth more than you think (but, it's worth an annuity rather than lump, so figuring out a 'value' is hard and variable, rule of thumb used to be multiply annuity by 20-25x for value)

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cornedbeef101@reddit

Having any pension at 20 is already a head start vs most people. Just keep paying the maximum you can into it and you’ll be fine. Well, about as fine as can be expected anyway.

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Redditor274929@reddit

Yeah, my pension is opt out so I was autoenrolled when I first started working at 18 and couldn't be bothered finding out how to opt out plus it would leave me with much extra in my pay anyway. Whereas by staying in, I'll have another 48 years to contribute anyway so I just pretend it doesn't exist in the mean time

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Ok-Blackberry-3534@reddit

The NHS pension works a bit differently to most that people are talking about here. For every year you work, it will pay out 1/54th of your annual salary, so if you're on £26k and you work for 27 years, you'll get (26,000 ÷ 54) × 27 = £13,000 a year adjusted for inflation. Assuming there's still a state pension by then you'll also get about £12k.

That's all assuming you don't get promoted and start earning more.

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Redditor274929@reddit

Yeah I'm currently at the bottom of the lowest band so my pay will absolutely go up over the years as it should already be higher but the nhs is terrible with organisation

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CabbageDan@reddit

Yes, although 27 is an odd number to pick as they are 20 and won’t be allowed to retire until 68 (on full pension. They can take a reduction to retire up to ten years earlier - at a cost of around 5% a year off the top of my head).

So a 20 year old earning 26k a year all their career who retires at 68 will get around 23k a year (plus state pension if it still around - so an additional 12k taking it to 35k).

Never opt out of the NHS pension while you work there.

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Redditor274929@reddit

Both of your comments have been very helpful in helping me understand and don't worry, I'll never opt out. I know how important it is to have a decent pension and also I'm paying in 6.4% which isn't going to massively help me rn.

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Ok-Blackberry-3534@reddit

27 is odd. I just picked the halfway point!

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JobAnxious2005@reddit

Mid 30s with £200k, on track for a million unless something unexpected happens

Note that most numbers quoted in articles are average and dot take into account the age of the person or lot!

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pinkdinosaurlady@reddit

32, around £15k now last time I checked

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Tiny-Distribution133@reddit

I'm 43 and this month I just tipped over £50k, which is approximately £50k more than I had at 33 so I'm doing alright.

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Probably a few hundred quid, I’m 23 and haven’t ever really thought about pension until this year

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thebuttonmonkey@reddit

Start now. Especially if you can get employer contributions.

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I-Spot-Dalmatians@reddit

Yeah I started a couple months ago, I think I pay about £70 into it a month. I’m planning on paying more into it at some point but just really can’t afford it right now. I only pay as much into it as I do because I know I’ll forget to ever enrol myself back into it if I opt out 😅

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minnis93@reddit

Great job to start so young. To give you some extra motivation, we'll say you contribute £100 per month once tax relief is counted. It will be more with your employers contributions, but assume none for now.

Assuming a 7% growth rate, investments will double every decade. So that £70 you're contributing (£100 after tax relief) becomes £200 when you're 33. £400 at 43. £800 at 53. And £1600 at 63 when you're thinking about retirement. And that's still a few years before "typical" retirement age. Every single month!

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I-Spot-Dalmatians@reddit

Thanks! That’s actually made it feel a bit less pointless 😅

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sobrique@reddit

The trick I found useful, is to do it each time your pay increases. (Even if that is 'only' inflation driven).

That way you don't really notice getting a bit less more pay, and so it hurts less.

Defiant-Tackle-0728@reddit

46 here and the only reason I have money in a pension is a coming up on both the lottery and premium Bonds.

Whilst neither were in the million range it allowed me to buy a rundown house, do it up and put money away.

I was also fortunate enough to be one of the last with a Civil Service Final Salary Pension which guarantees £20k a year. So I'm guessing between that and the private pension I'll be pretty average when it comes time.

I'll avoid mentioning cash amounts, but I contribute a matched 7.5% so basically 15% of my monthly wage currently goes into my pension pot, which since 2015 has went up in value by almost 50% via it's own investments. And I have a deferred pension from a previous job external to that.

I am a little paranoid about not having enough by the time I hit retirement, so I have money in stocks and shares, cash savings, bonds and a lifetime ISA which I'm also adding to as much as possible. So altogether, I should hopefully be in a healthy spot, I am in my mid-30s, but you never know what the future holds!

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willdapod@reddit

27 and I have one around £50k and another about £10k that I need to combine. Started paying in about 7 years ago. It used to be 6 + 8% but now it's 8 + 12%

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daffodillace1@reddit

About £1500 less than it should be due to my former employer having stolen it.

Except for that I have no idea which is awful! I have 2 NHS pensions and then multiple others in different places. Once I have this stolen pension resolved I will then be trying to locate the rest of my pension pots to get them in one place

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Thesmy@reddit

I'm 29 and mines £55K at the moment

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Necessary-Trash-8828@reddit

Fuck a pension pot.

Get a buy to let. Even if it costs you £100/month to have a tenant. The inevitable price rise over 20 years will be worth it.

Way better than paying into a pension

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filbert94@reddit

Haven't looked but it's around £36k and I'm mid 30s.

Flip side is I'm about to become mortgage free and have £15k in savings.

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prussian_princess@reddit

216k as in predicted in retirement or actually having 216k saved up in the pot?

Can't say how reliable the figures are but this page has a nice summary of average pension pot by age groups: https://www.charles-stanley.co.uk/insights/commentary/average-pension-pot-by-age-uk

_oOo_iIi_@reddit

Defined benefit was scrapped over 10 years ago along with a lot of the good things about our pension. 'Defined contribution' now lol, as if that helps anything.

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811545b2-4ff7-4041@reddit

Oh, well that sucks, and validates my 'get out of academia or be poor' decision many years ago!

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_oOo_iIi_@reddit

They are fuckers aren't they. My first academic job was with them. Also the way they've carved chunks off the pension benefits over the last 10-15 years means that most us will be working right up to state pension age.

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Limp-Archer-7872@reddit

No way is the average pension pot at 40 over 200k.

The 2x or 3x salary rule at 40 or 50 would be better expressed as a multiplier of net income minus mortgage, in my opinion. You would aim to have the mortgage paid off and you are not living on it now.

It also depends on retiring at state pension age or earlier.

In the end you work out what you need to live off in retirement to cover all your bills, eating out, holidays, presents, cat, etc. Then aim for 20x to 25x that.

So if you can live off 32k, and state pension is 12k, then you need 20k x 25 which is 500k at retirement.

You can use a compound interest calculator to then work out how much you need to put in each month to hit that.

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ledow@reddit

https://www.pensionbee.com/uk/pension-landscape

£87,887 - £195,058 Average pension pot size at 66, depending on when you started.

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sobrique@reddit

Yeah. At 60 maybe. MAYBE.

But I spend a load of time unsure how much is 'enough' pension. I'm increasingly convinced there's a lot of people who aren't saving nearly enough. Not that they can really afford to though!

But then, salary multiples and/or 'save X percentage' are at best very rough figures, and distorted considerably by things like 'tax brackets' and 'cost of rent/mortgage out of pre-tax income' vs. post tax.

thepoout@reddit

No one should have £100k in savings just sat around.

It needs to be in funds tracking the ftse. Otherwise that cash is diminishing with inflation each year.

I didn't say it was just sat around, I said it wasn't specifically allocated to a pension (I.e , a sipp etc).

And yes, I've even read smarter investing but thanks for your incredibly patronising concer .

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Limp-Archer-7872@reddit

Can she move some of that 100k into her pension (if she is working to get a decent pension contribution allowance). I presume it is otherwise in an ISA and not general savings.

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ImJustARunawaay@reddit

Unfortunately no - she doesn't work so can only put in a couple of quid to her SIPP.

And yeah, it's not actually all cleared yet (Still waiting for a house sale to go through), but we've maxed out both our ISAs, even put some in a JISA for the kid. The rest is currently sat in high interest accounts and premium bonds - which aren't super but they suit her risk profile.

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craigt00@reddit

E.g. https://www.unbiased.co.uk/discover/pensions-retirement/managing-a-pension/drawing-pension-income

"You have several options for accessing your pension. Each option has its own pros and cons, and some can be used in combination with others.

A 25% tax-free lump sum
An annuity
Drawdown
Taxable lump sums "

I'm 46 and have 44k. Story of working at small companies when younger that didn't have to offer pensions (under 6 employees) , then self employment and time out with kids. I'm trying to build it up now but I'm not a massive earner and have teenagers who sap all my funds!

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turdinabox@reddit

I'm basically exactly the same as you but with slightly less pension pot. Sucks cos I've always tried hard

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Lost_Haaton@reddit

I was late starting I worked 3 part time min wage jobs so didn't qualify until I was 27. It was then another few years before I started learning about investing. At 34 I currently have just 13.5k saved. I made a plan and assuming I average 4% actual returns I'll be about 42 when I hit 3x my salary (£75k) and from 52 onwards I'll have paid off my mortgage and can dump extra money into my pension. We won't have massive pensions but it should enough for us.

As we'd no longer have to commute to work, save or pay a mortgage, my partner and I would need about 30k/yr combined to maintain our current lifestyle and state pension would cover 22k of that currently as is.

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LifeBeatsOn@reddit

I had a pension review when I was around 40 and the advisor said around £100k would be considered on track.

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Tiny_Major_7514@reddit (OP)

Thanks was that for entire household? I'm considering a pension review but also aware that its biased, how did you find it? Did they try to sell you lots of stuff?

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LifeBeatsOn@reddit

Good questions! This was with an advisor from our company pension provider so they didn't try to sell me anything, just suggested I might want to increase my contributions, which I have done over a few years. I didn't ask if it was the whole house. I am trying to get my pension into a state where it can be our whole house as I have no idea what my wife is likely to get from her NHS pension. I was nearly 40 when I had the review and I had over £100k so I didn't question it much, I just felt better that I was doing okay. I have been with the same company for over 20 years and started contributing to my pension within a year of starting, even if it was at a fairly low level to begin with. When I get pay rises I try and increase my pension contributions a bit each time

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Chaosblast@reddit

I have £5k at 35.

I'm expat and self employed. I was adding £400pm to ISA till recently to FIRE, but at some point I realised it's great to bridge the gap, but the UK has pathetic state pension. So yeah, now I've shifted 100% to SIPP.

£550pm. Working slowly.

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57 12 year (half pension) value from military service, will pay £600 a month (at todays rates) 10 Defined benefit pension from previous employer, worth £105k, should pay £500 per month (at todays rates) £93k in my personal Sipp expect this to mature to £200k by retirement £55k in wife’s Sipp expect this to get to£200k by retirement Both should get full state pension

Ok the so called safe withdrawal rate of pension pot is considered to be 4% which in most cases will last your entire retirement. So - if you need 20k per year, you need a pot 25 times that - 500k (20k is 4% of 500k). Now go and look at those compound interest calculators and see what year you hit that figure, ah - this is your retirement age. All this is vague but you need to establish if you are screwed. HOWEVER, you’ve got time to do something about it. Go into the calculator and try out some different figures. You’d be surprised at what £100 per month extra will do over 25 years but due to tax relief if you did that, it’s only costing you £80 or £60 on take home pay to do it depending on your tax band.

Go over to the ukpersonalfinance sub and check out the flowchart.

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teedyay@reddit

Can you recommend a calculator that will take what I’ve got now and how much I’m putting in each month, and tell me what I can expect to have in 15-20 years’ time?

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JavaRuby2000@reddit

https://www.thecalculatorsite.com/finance/calculators/compoundinterestcalculator.php

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AgentGedge@reddit

The Aviva one is easy to use, and let's you include the state pension if you want.

https://www.aviva.co.uk/retirement/tools/my-retirement-planner/

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cannontd@reddit

Any compound interest calculator will do. The tricky part is working out the percentage increase as there are no guarantees.

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ImJustARunawaay@reddit

Using 7% after inflation is one hell of an optimistic calculation - I use 3-4%. Far better to save harder, and have a comfier retirement than expected, than ease off and be missing a few hundred k.

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Final salary pension here...

Yaaaaassssssssssssssssssssssssss

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EconomicsPotential84@reddit

Enough to buy a 4 pack of Special, a baggie, and a 12 gauge once I hit 60.

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TiredWiredAndHired@reddit

I'm 32 and mine's at £84k, I had a really well paid job out of uni and had 30% pension contributions for several years. I've dropped it down a bit recently and only have 15% contributions now but if I just keep feeding in I should be set when I retire.

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Objective-Shape-1499@reddit

Aged 40 and only started building a pension 2 years ago in the civil service. Currently have about £1500 defined benefit per year in my pension. That’s technically worth £15k if I survive ten years after retiring at 68 or £30k if I survive 20 years after retiring.

Big enough to retire when I hit 40.*

*provided I die a week later.

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mdkdue@reddit

I currently have about 80k in mine, age 48.

My main pension pot will be my house. No children, so nobody to leave it too. It’s worth 500k+ now, no idea what it will be when we retire. We shall sell up, move to somewhere cheaper and buy a 1 or 2 bedroom property, hopefully bank about 250k+.

Then of course there is the state pension on top of that which we have both maxed out.

I’m hopeful to be fair.

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Zealousideal-Habit82@reddit

£248k at 50. Started at 19, I earn UK average and currently save 6% me 15% them. Got out default funds a long time ago.

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krzykus@reddit

So if you started your pension at 18 and paid £100 each month with an average of 12% return after 22 years you would have

£1200 * (1.12 ^ 22 - 1) / 0.12 = £111k

If you started at 24 with £200 each month

£2400 * (1.12 ^ 16 - 1) / 0.12 = £102.6k

Basically the earlier you start the bigger the returns if you started at 18 and paid in only £100 per month then in total you paid in £26.4k. If you started at 24 and paid in £200 then in total you paid in £38.4k

Now that doesn't mean you can't retire comfortably if you start later. First if you have any high interest debt get rid of it ASAP (anything over about 7-8%)

Then softly (it may change) decide when you want to retire (eg I don't really want to work in my 60s as such I'm trying to save as much as possible in workplace pensions and ISA)

So let's say you want to retire at 60. Now we need to know how much you need each year. Think how much you spend on your bills food clothes etc. If you have mortgage and you pay it off before 60 great you can omit that but still keep in mind that you may need to do repairs and maybe redecoration etc so have some budget for that.

So let's say you need £1000 each month for your basic needs and bills. Some splurging etc £400 so in total you would need £1400 each month.

That's £18600 before tax (yeah you need to pay tax on pension) each year.

There's a 4% rule saying that by withdrawing 4% each year you shouldn't run out of money (not always true and sometimes you may end up with more money than you started and miss out on life)

But it's a good starting point 18600/4% = 465k

So by the age of 60 you need to have £465k now let's assume you have 0 in your pension and you're 40 giving you only 20 years to save up that's quite a big "scary" number but we can get there.

If we save money under the mattress without any interest then we can simply divide the amount by number of months then we would need to save £2k each month ok the number seems less scary but still quite big

Now the magic happens when we include interest with long term.

So if we switch the formula I've used at the beginning into this:

465000 * 0.12 / (1.12 ^ 20 - 1) which equals to.. 6500 each year or £540 each month, now this looks much better.

Now bear in mind that 12% is pretty high with 8% you would need to save up about £850 each month

But hold on a sec I already have some in pension clearly I don't need to save so much. Yes and you can calculate how much that will grow and just subtract from the amount you need when you retire.

If you have 40k and we assume 8% growth then after 20 years you should have... £186.4k which you can subtract from the 465k and do the calculation again (sorry I did this on purpose)

This assumes you won't need professional care etc and your needs may be different so do the numbers yourself etc and spending time with a financial advisor could be beneficial.

You can also check James Shack on YouTube he makes great videos about this topic.

Ps. I'm not a financial advisor just a guy who likes math and crunching numbers

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culturerush@reddit

37 and the last letter I had from the pension provider for the company I worked at for 8 years said my pension is on track to give me £30 a year.

I've been working in the NHS for 6 years now and I'm hoping that makes up for whatever omnishambles the company I work for made with my pension

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Onomatopie@reddit

Your nhs pension can give you a statement.

It's easy to calculate yourself though. It's just 1/54th of your income, added to the figure manually, as a guaranteed income at 68 (or reduced if taken early) rising by an amount per year based on inflation and an extra amount if you're still contributing to the scheme.

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culturerush@reddit

Working until 68 sounds absolutely grim

I can't see how I can carry on in my current job for another 5 years without completely burning out let alone another 31 years. I've already been working full time for 16 years. My dad retired on full pension after working full time for 35 years, if 68 is my retirement age I'll have to have done 47

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Onomatopie@reddit

Well it's state pension age.

So if you can manage your expenses, pension and savings sufficiently then you'll be able to retire sooner.

I'm aiming for 58 but the aim is any time before state pension age.

I think my NHS pension reduces by about 40% if I take it at 58 with no lump sum. Which is fine, it's less drawdown from my private pensions.

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Limp-Archer-7872@reddit

Wow is the pot under £1000 after 8 years of contributions and growth?

The nhs one will be better, and you should be able to see where you are at on the portal.

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1stEleven@reddit

I think you made some miscalculations in your wages.

Self employed means you should pay yourself a pension and have a bunch of reservations and insurances set up. It should be a sizable part of the wages.

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Tiny_Major_7514@reddit (OP)

Of course, but without the forced nature of workplace pension schemes it often doesn't happen as it should for self employed

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1stEleven@reddit

Which is a shame. And a scam.

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Puzzled-Barnacle-200@reddit

I'm 26, and my pension is 38% of my salary. Ignoring any above inflation salary increases, I should be set to reach 1x my salary at 30. However, in approximately 2 years I anticipate reducing my working hours (and hence salary) by 20% for 7-10 years. This means that when my hours go back up, my ratio will drop significantly, so I don't really know how to plan for that

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gardening_gamer@reddit

36, \~90k. Thought I was doing alright until I happened to be speaking to a few of my friends from uni the other week, same age. 2 are sitting at about 200k, another at 415k.

Saying that, there's just so many other factors to consider. If you own your home outright by the time you retire, that would make a massive difference to your expenditure, and just the general level of disposable income you're accustomed to spending.

Personally, we get by ok as a family of 3 with monthly expenditure at \~1k, and so I'm not panicking.

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Tiny_Major_7514@reddit (OP)

Yeah, you're right - just look at the huge variant of responses here. It's almost too large to even bother working out a median or average. I have about £170k in savings and own our home fully, so I do need to factor that in too.

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Scottish_B@reddit

£520k at 40.

I pay into my pension rather than paying high rates of tax. My investment growth has been incredible too with 15% annualised returns over 12 years. I'd like to get to £3m for retirement.

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TeaSlurpingBrit@reddit

Whats a pension??

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TheseEmployup@reddit

I'm 46. I ha e about 20 grand in a pot. I started very late. I'm probably fucked

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Important_March1933@reddit

Some of the comments on here! No wonder people get into a state when they hit old age and expect the state to look after them. People have 40 years of work to prepare, then they get to retirement age and suddenly realise they are fucked.

Instead people should take more responsibility, invest in pension as soon as possible, with as high a contribution as possible. Tax thresholds are shrinking on a lot of things, as it stands be efficient and get those pension pots going!

Realistically you have to question who is pushing these figures....that's right pension companies who make money from people paying into pensions. Fear sells.

It's not dreadful advice but realistically I'd suggest its about the bigger picture and not just one product personally I'm around this age my pension pot isn't great (about 50k and it's the focus just now) but my overall networth is about 500k when counting property and investments so whilst I'm far from loaded im probably not going to starve despite what AJ Bells how prepared are you for retirement calculator tells me.

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Puzzleheaded_Act7155@reddit

I’m late 30s my pot as it sits today is £148k

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PhantomLamb@reddit

45 years old and have £147k. Was putting in 5% + employer matched 5%, bit just increased that to a total of 13%

I dont understand pensions and so I've always kind of never thought about it and just put in 4-5% with employer matching. Just recently I've realised it probably should have been more.

I would like to retire in my late 50's and I think I've not been saving enough

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Less_Mess_5803@reddit

Depends on your other commitments, if you are mortgage free it's possible

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Jjmmww1@reddit

28 here with 25k in currently with £350 going in every month now

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volvocowgirl77@reddit

I have no idea. 22 years in an nhs pension

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AdHot6995@reddit

35 and 1.3 million GBP invested, not specifically in pension though.

I’m on a final salary based pension which I’ll qualify for the full amount after 40 years service which will be when I’m 67.

I have to say I find the UK system for pensions to be opaque and not fit for purpose, especially since salaries have been stagnant for years. I’m American, my pension is healthy but the bulk of it is because of what I was able to save prior to moving to the UK. I was extremely aggressive in pension savings as I did not expect any kind of safety net no matter what country I retired in.

No longer self employed, but was between 2006 and 2019.
I was about 30 when i started to build a pension to offset corporation tax, approx £8k a year contribution, and hit £100k at 40. I think it was £140k in 2019 when I stopped paying into that one.
It doing its thing is now £200k while i have contributed to a workplace DC pension since.

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ButterflyRoyal3292@reddit

Yes, you get both. I retired last year and I get my state pension and what I draw off my other pension. I had about 4 different pensions which were merged and invested.

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SilentSniperK@reddit

Suicide = My Pension

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AdhesivenessNo9878@reddit

Technically none since it's a defined benefit pension. But if I continue working as a civil servant until retirement in 40 years time I'll retire with more income than in my working life

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dgshotuk@reddit

44 and 208k and currently putting in 2k a month via salary sacrifice, hoping to start to use it from 58

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dazabhoy67@reddit

There an old rule of thumb when it comes to pensions supposedly you should be paying in half your age. In order to have something decent by 65/67

It only works up u till about your age though.

But supposedly you put in half your age. So if you start at 16 it would be 8 percent.

If your 30 it would be 15 and so on.

dazabhoy67@reddit

I'm 34 , only paid in to mine in my last employment for a short period maybe 5 or 6 years and I have 28k in it.

Left there 2 years ago, like you self employed and haven't done anything yet.

It's on my to do list in January. Going to start putting 200-250 away a month to try and recover a bit of my slackness.

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Academic-Chocolate57@reddit

29, £41k

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Resident-Stevel@reddit

46, slightly over £100k. But I don't own a house and likely never will so that's going to have to cover rent as well, so it's not as much as it may seem.

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ThirdD3gree@reddit

28 and about £60k

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AdSoft6392@reddit

I'm 31, got about 200k in my ISA, 100k in a SIPP, plus I have a DB pension which I think is currently worth about 4.5k a year.

Inheritance, I got 15k when my grandma died last year, the rest has just been me saving and enjoying market returns.

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Private__Redditor@reddit

What sort of ISA ?

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AdSoft6392@reddit

Slightly irrelevant giving a number considering home ownership, what you spend/would spend etc.

MauriceDynasty@reddit

23, 16k choosing to overpay to avoid getting taxed to oblivion.

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TescoGangsta@reddit

I have a modest amount. Where I work currently couldn’t give a fuck about any of us and the pension isn’t worth shit.

No one in my family lives long and I am currently torn between getting a private pension in the fact I actually live beyond 60, and going full yolo

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Theodin_King@reddit

No idea. I have 4

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outlaw_echo@reddit

A what ! \~? No idea what the F8K your talking about...cant afford to save for a set of tyres, never mind retirement

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Sgreaat@reddit

I'm the same age and I've paid into a pension for the majority of my working life.

Split across a number of different providers (I'm never sure what to do for the best there) I probably don't have any more than £50k.

Nowhere near the 3x salary you mention. Not sure that will get me much of a pension but I suppose something is better than nothing.

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anonymouse39993@reddit

I get 1/54 of my salary into a defined benefit pension yearly projected to be about 30k a year pay out adjusted for inflation

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Frosty-Growth-2664@reddit

Do check to see if it is under funded (i.e. it doesn't have enough funds to pay out all it might need to). This is the situation with many defined benefit schemes.

AvoidFinasteride@reddit

Am 39 and probably around 3k. I don't earn well and will be working until I drop. It's a horrible feeling, and being poor is horrendous.

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Cook-Few@reddit

117k at 36.

The best advice I ever had was to start pension payments with my first paycheck so you don't ever miss it. I had a few years of 18% (mine + employer) which really kick started it, even on the wage I had then.

The last 4 years at my new place aren't anywhere near as generous so it's slowed down a bit but it's amazing how it snowballs once you get some in there.

Next best time to start saving is today.

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Agreeable_Fig_3713@reddit

Dunno. I’m nhs but it’s patchy as I’ve had three age gap kids and time off/out pension scheme after each one.

FarIndication311@reddit

38, £150k.

As soon as I got my first "proper" job in my mid twenties I decided to max out my employer contribution.

If I paid in 7%, they paid in 14%, making the total 21%. I did this as the pay difference between my previous lower paid jobs and my first "proper" job was large enough that I still had a bump up in pay, and just wanted to get as much of the free money as I could.

I never touched the % again all the time I worked there.

I have fidled with the investments though, only in the last couple of years I've attempted to replicate an all World all cap index using the funds I have available to choose from.

The value bobs up and down of course but sometimes I look at it and it's gone up by the same amount I've earned in total for a few months, like another me working but it's entirely passive.

ThoburntheBlack@reddit

31 and £75k.

Since I started work I've always been putting money in. Therefore I never felt like I was "losing money" by starting to pay money in.

New employers contributions are very generous so have £900 a month going in from now on.

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Apadhiar123@reddit

48k at 31, was on 30k at the start of the year but the market has done well this year, I currently have £550 a month going in which includes company contributions and matching scheme. I try and aim for a 10k jump each year with contributions and market but this year has done well in tech so nearly at the 50k mark

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cjgmmgjc85@reddit

I've been buying bitcoin for years, not sure what I'm doing if I'm honest. I'll work that bit out later 🤣

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I've got enough for a nice month off before I end up collecting trollies at Asda.

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A-Grey-World@reddit

In my first job I paid the max my employer would match, my wage was a decent early career graduate wage. I worked about 5 years I think, and at the end of it I remember getting a letter from my pension provider saying I'd earned a retirement income of... £300 a year! Or something like that. I remember thinking at that moment "Well, I'll be working until I die then lol.

I still paid in, but I completely ignored it and just tried to accept working until I couldn't.

However, I now earn a pretty high wage and when you're in the higher tax brackets it makes so much more sense to pay into your pension. I pay \~30% of my salary in right now, and currently have \~£125k in my pot - but that is increasing by more a month now than probably my previous first 5 years of employment. I add about 36k a year to it.

I don't expect to have a high income for long, so am trying to shovel in as much as I can in there.

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Kooky-Boysenberry-82@reddit

I’m a high earner now, and have earned decent since 28, just about higher rate tax until about 3 years ago and I then earned pretty silly money.

My pension pots combined at 41 are £246K.

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Substantial_Fox_6721@reddit

I'm 40 and my pension is currently about £30k however that's for a few reasons - primarily that I've invested into a second property instead (no I'm not a landlord, my mother lives there for free having moved in when my dad died and they lost their home and will probably do so for many years to come so put the pitchforks away). The second reason is that I now earn five-six times more than when I was 25 so I'm able to pay in much more these days to start catching up. I also have investments elsewhere.

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Squire-1984@reddit

I dunno. Around 80k? Not yet 40s.

Tbh it only starts to rocket right at the end due to compounding, unless you get a large pay rise

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YLRESS@reddit

My pension pot has £100 in it due to the auto enrollment cafuffle.

Late twenties here, uninterested in building a retirement.

I'm ambitious. I want to earn a retirement package per annum in wages to be honest.

spnelson@reddit

I’m 31 and around £7k 🥲

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Gadgie2023@reddit

No idea.

Defined benefit. 8.30% employee and 8.10% employer contribution and have paid in for 18 years, so far.

I also do a voluntary contribution of £264 a month on top of that and any bonus is thrown in to avoid tax.

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SeshGodX@reddit

I'm 29, got roughly 20k pension, at 40 I should have around 100k. The 200k doesn't seem realistic unless maybe you started working early, no uni or nothing like that.

I've only started full time work with pension 3 years ago.

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Previous-Ad7618@reddit

It's in the ballpark of 100k.

I'm 1 year off clearing my student debt. At which point I'll transfer that payment to pension or to mortgage overpayment which will ramp it up a bit.

ninja-wharrier@reddit

For background I retired 6 years ago, am 62 now.

In my planning for retirement I assumed a 4% drawdown on money purchase pension (SIPP, etc). Plus any final salary income which gives me a base guaranteed amount. Don't forget you will still be paying tax at the relevant rate.

lab88@reddit

36 year old and 25k currently in. I'm putting 5% in matched by company. It was 12k a year ago it's only really this year I've upped it to 5% and have started earning decent (for my area) money.

Hopefully, I'll have enough to live steady in retirement, but I'm really not sure.

Outrageous_Ad_4949@reddit

NEST is a joke.. wasting our money. Can you find your retirement fund's performance on their website? It is considerably worse than inflation.

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burkyeah@reddit

I'm 33 and just hit 100K and got about another 10-20K in separate pensions and a S&S ISA.

Fortunately if I put in 7% my employer will put in 13.5% so I've been doing that since I started about 7 years ago.

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MrsKebabs@reddit

23, I got £400 in savings does that count?

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TemporarySprinkles2@reddit

I'm 42 and haven't a clue what is actually in my pot currently. Feels like it'll be about £40k ish. I have some small pots elsewhere I really need to think about consolidating into my current one, which I pay 5% into with employer paying 7%, so works out to about £500 per month. I'm essentially on a final salary pension (almost, I think), so hoping I can make it to Director level in the next 20 years, and hold onto it long enough to qualify for the pension.

7k at 26.

Word of advice, find out what your workplace pension is actually invested in. Because the default fund is usually extremely risk averse, and will likely cost you hundreds of thousands of pounds over a few decades. You want to be invested in a passive global index tracker for the best returns, and the risk really is minimal over such a long time period.

As always, do your own research and don’t just listen to a bloke on the internet.

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NandoCa1rissian@reddit

The state of the country is fucked in 30 years given these abysmally low pensions. Puts on the UK lmaooooo

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Outrageous_Ad_4949@reddit

"UK average at 40 is as high as £216k"

What is that average supposed to measure? How far is it from the median??

Only a single occupational pension fund? Mine is £16k at 44. All savings and investments? I'm slightly above that average. All amassed wealth, including any companies or properties owned, all debts subtracted?....

Don't beat yourself over a small pension pot if you're 10 years away from completing your mortgage payments on a property worth ten times more than said pension pot.

From my years perusing budgets and employee salary lists in different industries, if what you want is a large pension pot find a job in education! They're desperate to hire anyway..

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North_Stretch_7345@reddit

32 years old, just hit 100k in pension

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captain-carrot@reddit

I hit 40 next month - sadly I worked at a place with no pension for a long time so I've only really been paying into a pension for about 10 years. For a while I payed the basic contribution (so 5%) but for the past few years I have been paying 10% with a further matched 6% from employer.

My pot is about 50k now, so it is building but not nearly as high as the average you have seen.

HOWEVER one of my first real jobs at 20 was as a paraplanner and I worked in pensions. I’ve always maxed out my contributions and from age 20 earned more than £26k a year and never earned less than £35k per year. Once I started earning £40k then £45k then £50m a year plus when I hit about 32 I put everything over that into a pension as I didn’t want to pay higher rate tax. I just stuck to living within my means. Pensions were just ingrained into me very young. One of my employers paid 12% for 7 years as they’d match my contribution up to 12% and I did it even though that started when I was about 23.

The downside is my husband has always been self employed and never bothered with a pension so we’ll both be living off mine.

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OK_TimeForPlan_L@reddit

No idea, I've got credit card debt and a loan to pay off before I can worry about saving for 40 years into the future lol.

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GamingTitBit@reddit

32, 99k. I worked for a charity for 6 years so wasn't earning big bucks but my mum was very helpful in telling me to invest early. Was contributing 12% (me: 5% company: 7%) in my previous job and 18% now (me: 10% company: 8%). Thanks mum!

I think my major regret is not changing the pots they're in. Currently in a medium risk and either should be high or in an index fund.

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Mid-40s, I've just checked and it's £21k.

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4XHMR@reddit

29, 29k

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Robotniked@reddit

My mum used to say that if I fell in poop I would come out smelling of roses.

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ItsIllak@reddit

50 - £262k + a small DB pension (not even sure how much that will pay out, maybe the equiv of £4k/year?).

However, I've added £137k of that in the last two years, so it wasn't in even worse shape before that.

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owen_legend@reddit

How big mine or anyone else's is isn't really all that important to you TBH - but you're far from alone if you've neglected it a bit. I did too for a while when younger, then spent a fair few years putting slightly painful amounts in to catch up.

But for what it's worth, I'm a few years older than you and it's around 5x my base salary today, though only \~3-4x my total income.

Me and my partner are 31 and 30 respectively.

We both have approx 35k in our pots. 70k current total.

Both contributing around £600pm now and invested in equities so we’re hoping to see a good improvement over the next 10 years or so.

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SpudFire@reddit

32, 19k. I've recently had a payrise so I think I'll speak to my boss about putting more into it now.

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DaZhuRou@reddit

41, ~350k... also self employed for 7 years.

I stopped at 40, and said I wanted it to grow 10% every year, either from investment growth or a top up contributuon from me. So far the plan is working well and have had some great growth in SIPP. I review quarterly and look for 2-2.5% growth as I worry about cashflow.

But at 36, I genuinely started throwing an obscene amount of money into the pension.. I had about £18k.

Tbh you just need to get into the mindset of paying the pension first.

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No-Body-4446@reddit

85k at 33. Better than some. Worse than others.

I wouldn't worry about other people OP. just pay in what you can. Morbid but 1/3 of us won't get to enjoy a retirement. I think we all know someone who retired after working hard their whole life and was dead shortly after. Yes put something away, but don't fret too much, particularly if you own a house and are paying that off.

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GabberZZ@reddit

53 and about 100k and the wife about 60k but we have no kids and paid off property investments to the tune of about 700k. We plan to downsize and move abroad once the parents have all shuffled their mortal coils.

If I'd taken up my employers pension scheme in the late 80s I'd imagine the pension pot would be at least double this but... Bloody teenagers.

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cloud__19@reddit

What other people have or don't have is completely irrelevant. Work out what you want your income to be on retirement and work backwards from there. There's loads of calculators to help you do this. Only you can say what sort of lifestyle you ideally want in retirement and then you need to figure out if/how you can make it happen.

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Tiny_Major_7514@reddit (OP)

Thanks. My situation is this: Own my house outright (worth around £300k). Household savings of £170k. Combined household pension pot of £85.k I'm 40, wife is 39.

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bars_and_plates@reddit

I deleted the original post as I intended to repost it, sorry.

In that case then I'd say you can think about it two ways - one is to say the house is there regardless, so you have 170+85 = 255k. 4% of that annually is (v roughly) 10 grand. Add that to whatever you're entitled to e.g. state pension etc and that's your retirement. Whether that's enough is up to you.

Put mine into a commercial property which will be worth around 550k by the time I retire in 15 years or so.

We've been close to bankruptcy a few years ago and have slowly, clawed our way back.

My pension will essentially be my businesses which I'll sell in a few years... Bar some sort of financial crash... Again 😬

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latflickr@reddit

At 40 my pot was somewhere around the 60-70k mark

I hit 100k at 45, 150k at 50.

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Critical-Bonus-6411@reddit

I like many was doing 5% matched to employers 5% maximum contribution. Until the mortgage was paid off. Thanks to my wife, I had my first mortgage at 22, though at the time I wasn't impressed as it was financially hard work and at times living week to week, budgeting food etc.

Now paying in 29% plus the 5% employer and the pot is finally somewhere it looks like we will be comfortable in retirement, mind you that's still 8 to 10 years away. It's currently at about 7 x salary.

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thepoout@reddit

39 (very nearly 40) 200k ish in pension at the moment.

Employer contributes about 1k a month, i've never contributed.

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tommycahil1995@reddit

I have a pension from my old corporate job which I don't even know what's in that. My grandad left me some money, and I'm saving for a house right now. Not bothering with the pension until I get the house sorted and Id rather have more for that quicker than a pension at this point.

Self employed too so it's much harder to justify a pension when you aren't getting an employer to put money in

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JollyMatlot@reddit

60, 300K plus a business I'm selling when I retire for a Min 700K

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ExPristina@reddit

Not nearly enough and my kids aren’t looking to receive a decent inheritance either. Future is not looking hopeful.

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RP2209@reddit

It's a bit late to be worrying how much you should have because it sounds like you don't haven't saved enough. You should put away as much as you can afford to, especially if you are a higher rate tax payer. The thought of having to work until I'm 67 (if I had to depend on the state pension to survive) is frightening.

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neenoonee@reddit

34 and 2k

I spent a lot of the past ten years working a seasonal job I loved. It did not pay much. At the time I didn’t realise that working wasn’t just about paying the bills for now, but is also saving for the future.

I’m looking to open a LISA but also up the amount I put in my pension to the highest my employer will match. I’m also on a low wage currently, so I’ve just got to do what I can till I can earn more.

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crispcrumbguzzler@reddit

28 and it's 13k

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