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Retirement

NorthwestFox

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Most of us are at or close to retirement age. Given we get the max Government pension, what is the minimum retirement pot you think you will need and roughly how long do you think it will last you?
Is your house included in your calculations?
 

Filbo65

Thatched roofer
I suspect most people would hope that their pension pot will last until they die!
Particularly as the final few years tends to be the time when you need the most money to try and make life as bearable as possible...
 

NorthwestFox

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So if you put say 5 grand per year in your pension find over 30 years that's £150,000.
Obviously there is the reinvestment element but it doesn't seem close to 500 grand.
 

Paddysfoxes

Bill Poster
In a very fortunate position of final salary pension scheme, that was phased out years ago but will be honoured for members who joined proir to it closing
 

Bowdenfox

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Wouldn't worry too much about it. Bloke down the road from me used to boast about the final salary scheme he was on, didn't see out the first 12 months of it.
My mother in law god bless her didn't have a pot to piss in, yet lived happily into her 80's and had the state pick up the tab of her care home fees.
 

Filbo65

Thatched roofer
So if you put say 5 grand per year in your pension find over 30 years that's £150,000.
Obviously there is the reinvestment element but it doesn't seem close to 500 grand.
Correct. But no-one sane will advise you that £5k a year is anywhere near enough to put in.
The last fifteen to twenty years have turned previously widely-accepted investment returns on their arse. If you want to protect your capital, £500k throws off a paltry return these days.
There are also differing extents of the maximum state pension, depending on contributions made prior to some magical date that I've forgotten. Mrs Filbo is due more than me for that reason.
 

neverbemastered

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Unless you had a cunt of a boss who had his filthy fingers in the company final salary scheme.
Pensions ombudsman is a total waste of time and whilst he had teeth seemed very reluctant to bare them, and it did go to the main man.

Trust me- cash is king.
 

snootyfox

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Excellent question NWF. To my complete shock (probably because I know nothing about finance and had done no research), I asked my ‘pensions man’ this question, and he said exactly the same as Micky..500k
 

Billsballbag

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Rock bottom interest rates on government bonds are going to make the thin pensions get even skinnier.

There’s therefore little point for people my age.

The average retirement age will be over 70 very shortly. Work that one out when the public sector moaning cranks up..
 

Filbo65

Thatched roofer
If you were 65, in good health, non-smoker, wanting a guaranteed 10 year payment period, with RPI increase each year, but with no spouse pension, £500k would get you about £13k a year if you were retiring this month. :eek:
 

ElmetFox

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There are lots of divisions in the country. There are relatively rich pensioners like Mrs E and myself who each have private pensions plus state pensions because we were lucky enough to be working when final salary pensions were the norm. But anyone aged under 60 not employed in the public sector and on average pay is really going to struggle. Half a million sounds a lot, because it is, but at current returns of 2% max that is a return of £10k p.a. State pension add another £6 -7k. I have not looked, but I suspect the annuity rates are not much better. How is a normal family going to find half a million? Someone mentioned the house. Yes, you could sell it, downsize and live in rented accommodation but you still have to pay the rent. I live in a relatively low cost part of the world but even here in West Yorkshire you would be lucky to find something decent to rent below £750 a month. As Micky is right in his assessment, one is reminded of the advert from all those years ago that said you should start saving early. Us Baby Boomers should count our lucky stars to have been born when we were. I count mine that I was born in a nursing home on Fosse Road South and grew up supporting Leicester City.
 

Filbo65

Thatched roofer
I know of someone who retired from the Bank of England in 1976 after 20 years service, aged 45, on a final salary of about £5-6k I think. Took the Bank pension from age 60 in 1991 and, by the time of death in 2016, was getting £20k a year.
A story of inflation, as well as gold-standard public / private sector pension schemes – and why they became unaffordable for most!
 

Billsballbag

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People used to retire when they were too old to work.

Generally people still expect to retire at the same time irrespective of the fact that the average age people get to has risen dramatically over the last 30 years.

There is a decent argument to say that retiring at 65 is bad for you. The “youngest” old people I know still or have worked into their 70’s.

Health allowing I intend to do the same as a result.
 

Filbo65

Thatched roofer
Nice work if you can get it.
I know an Occupational Therapist who managed to get her job classified as 'stressful', and so has recently retired on a full pension at 55.
Not sure she ever lost a night's sleep over her work, tbh.
Not sure but they have a cushy number on big money for not much more than prescribing tablets 😉
TBH I have quite a lot of sympathy with the very good ones – it can be a seriously thankless job. But not all of them are even good.
 

Billsballbag

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Well if you get to retire in your 50’s with a pension pot of the equivalent of well in excess of £1 million, courtesy of the good old taxpayer,who then can’t retire at all...
 

ElmetFox

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Bill re your observation that there is a decent argument for saying that retiring at 65 is bad for you. I would respectfully disagree. There is no argument other than a financial one for continuing to work a single day longer than you have to. You wake up in the morning and the day is yours. To do as much or as little as you want. I have been retired 17 years and I cherish every day. Again I was one of the lucky ones who was able to take early retirement although with a reduced pension, which was only right since I had not paid in (contributory, 6%) enough to justify a full pension.
 

Billsballbag

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It’s not for me Elmet. Some are the retiring type and some aren’t I guess.

Ive never been able to sit still. Will probably come in useful as it’s my generation and those below who won’t have the luxury.
 

2 Pints of Lager

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I was on a final salary pension scheme, with options theres a cut off around 89 if you think your going to live longer a smaller lump sum and a bigger pension is best, I opted for the larger lump sum and a smaller pension as with being married two kids and supporting city, I don't think I'll live past 88😂
 

MrTeabreak

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i've got a uk one and a US one, i've also spread my investments into other things, and my son is a crypto whiz so i am getting advice on that too.
I've put as much as i can into mine.
Foregoing luxuries like a nice car and fancy holidays, I've put the extra into my pension. so whilst my contemporaries are driving around in bmw/merc/teslas i've got a 24 year old honda with 255k on the clock, and the last vacation i had was in 2016.
My dad was a pension advisor for the police so he drilled it into me to start early.
He said this which has always stuck with me:
"the only thing worse than being old, is being old and poor".
once i retire i don't plan on working at all.
3.5 years to go ...
 
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