Your browser isn't supported
It looks like you're using an old web browser. To get the most out of the site and to ensure guides display correctly, we suggest upgrading your browser now. Download the latest:

Welcome to the MSE Forums

We're home to a fantastic community of MoneySavers but anyone can post. Please exercise caution & report spam, illegal, offensive or libellous posts/messages: click "report" or email forumteam@.

Search
  • FIRST POST
    • stolt
    • By stolt 12th Mar 17, 12:44 PM
    • 2,792Posts
    • 1,206Thanks
    stolt
    Pension planning, so many questions with not enough answers?
    • #1
    • 12th Mar 17, 12:44 PM
    Pension planning, so many questions with not enough answers? 12th Mar 17 at 12:44 PM
    h everyone, i need some advice I have spoken to our accountant at work but his patience is well not too great.
    ive spent alot of the last week looking at pension information online and realise i need to sort everything out and have a plan so i can plan for a good retirement.

    Im 42years old i have work pension which is with Aviva the plan value is 138,868gbp it shows payments of 714gbp a month contribution from my employer which i need to check with my work because when looking on the yearly statement it shows 8601 payments but i cant see my payments. I know im on a salary sacrifice scheme so maybe thats why.

    the plan is on the aviva mixed 40-85% shared s6.

    avia let you go online and you can go for higher risk plan but ive been reading up and will do some more before taking the plunge on moving it because i know there is alot of risk but i dont want to leave it too late before going to a higher risk plan.

    can anyone offer some advice on where to look for this advice and where i can break down where best to check which plan would be better for me.

    my aim would be to retire at 60 and looking at what ive read to get a income of aroudn 20k a year the paln needs to be around 350k, i know in the next 20 years my plan will increase anyway. my wife hast worked for 10years and has a very small private pension so i will need something to support us both.
    Last edited by stolt; 12-03-2017 at 2:38 PM.
    Listen to what people say, but watch what people what people do!!
Page 1
    • AnotherJoe
    • By AnotherJoe 12th Mar 17, 1:08 PM
    • 6,824 Posts
    • 7,243 Thanks
    AnotherJoe
    • #2
    • 12th Mar 17, 1:08 PM
    • #2
    • 12th Mar 17, 1:08 PM
    h everyone, i need some advice I have spoken to our accountant at work but his patience is well not too great.
    ive spent alot of the last week looking at pension information online and realise i need to sort everything out and have a plan so i can plan for a good retirement.

    Im 42years old i have work pension which is with Aviva the plan value is 138,868gbp it shows payments of 714gbp a month contribution from my employer which i need to check with my work because when looking on the yearly statement it shows 8601 payments but i cant see my payments. I know im on a salary sacrifice scheme so maybe thats why.

    the plan is on the aviva mixed 40-85% shared s6.

    avia let you go online and you can go for higher risk plan but ive been reading up and will do some more before taking the plunge on moving it because i know there is alot of risk but i dont want to leave it too late before going to a higher risk plan.

    can anyone offer some advice on where to look for this advice and where i can break down where best to check which plan would be better for me.

    my aim would be to retire at 60 and looking at what ive read to get a income of aroudn 20k a year the paln needs to be around 350k, i know in the next 20 years my plan will increase anyway. my wife hast worked for 10years and has a very small private pension so i will need something to support us both.
    Originally posted by stolt
    The contribution "from your employer" you are seeing just means the amount that the employer transfers into the scheme. They dont separate out or distinguish (because they dont know or care) how much of that money came from you and how much from your employer). So lets say you pay £614 and employer £100. They will just show "£714 from your employer".

    What you are invested in looks to me to be a middle of the road scheme to me, with quite a high international spread so its probably done quite well recently, I'm sure others can comment how good it is ( of course that can only be compared to what you have a choice of, rather than agaisnt every possible fund there is)

    You could (??assumption here??) always hedge your bets a bit by putting some of your future contributions into another "riskier" fund in addition to your current one. Do they give you that flexibility? The trouble would be as a naive investor which fund to pick. My current company pension plan has 329 different funds across the scale from dull as ditchwater to hold onto your hat "woohah!" My previous employment scheme had about 10 choices (all of them rubbish )

    So perhaps do some investigation as to what other funds you have access to and if you can mix and match.
    • dunstonh
    • By dunstonh 12th Mar 17, 1:28 PM
    • 88,292 Posts
    • 53,522 Thanks
    dunstonh
    • #3
    • 12th Mar 17, 1:28 PM
    • #3
    • 12th Mar 17, 1:28 PM
    h everyone, i need some advice I have spoken to our accountant at work but his patience is well not too great.
    Plus pensions are not really under the remit of accountants. A lot of them have mostly generic understanding nowadays and are often out-of-date on current pension issues (as is understandable).

    avia let you go online and you can go for higher risk plan
    It is not the plan itself that dictates the risk. It is the investment selection within the plan that does that.

    can anyone offer some advice on where to look for this advice and where i can break down where best to check which plan would be better for me.
    If you need advice then you are best getting it from an IFA. Not an FA.
    It is unlikely that changing your plan is going to be the best option. Your employer has to comply with auto-enrolment (AE) and most employers will only contribute to their AE plan. Not to your individual plan. So, you are likely left with the investment options within your existing plan.

    Aviva will offer simple multi-asset investment funds as well as a range of single sector funds. The fund range will depend on which version fo the product the employer is using for their auto-enrolment. Single sector funds tend to be used by more experienced investors or advised solutions using investment models.

    y. my wife hast worked for 10years and has a very small private pension so i will need something to support us both.
    Do not forget her pension. You can earn £22k a year between you tax free in retirement by using both of your personal allowances. If the planning is top heavy in your name, you may end up wasting some of her personal allowance.

    my aim would be to retire at 60 and looking at what ive read to get a income of aroudn 20k a year the paln needs to be around 350k,
    £350k is insufficient to provide £20k in real terms unless you are prepared for capital erosion or you are including the state pension in that figure (unlikely at age 60!). It may be that your modelling is a bit of both (i.e. the 60-68 gap with no state pension funded by yours and your wife's pensions with greater withdrawals with less taken once the state pension kicks in). So, understanding how you have modelled the £20k figure and whether this is net of state pension(s) and joint provision would be helpful.
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. Different people have different needs and what is right for one person may not be for another. If you feel an area discussed may be relevant to you, then please seek advice from a Financial Adviser local to you.
    • bigadaj
    • By bigadaj 12th Mar 17, 1:32 PM
    • 9,347 Posts
    • 5,974 Thanks
    bigadaj
    • #4
    • 12th Mar 17, 1:32 PM
    • #4
    • 12th Mar 17, 1:32 PM
    Salary sacrifice won't differentiate between employer and employee, oh are sacrificing salary, so that doesn't get paid and everything is paid as an employer contribution, so including the tax and NI you would otherwise have paid.

    Increasing risk may well mean higher growth but can also lead to larger losses, the big increases recently with many funds are due to sterling devaluation, and that isn't something that will continue indefinitely.

    If you want to take a long term income of £20k in real terms then you'll need a far larger pot then £350k, current annuity rates would suggest soemthing around double that, using drawdown then you are probably looking at around £500000.
    • stolt
    • By stolt 12th Mar 17, 2:34 PM
    • 2,792 Posts
    • 1,206 Thanks
    stolt
    • #5
    • 12th Mar 17, 2:34 PM
    • #5
    • 12th Mar 17, 2:34 PM
    thankyou for the replies. it seems i really still need to do alot of reading about pensions. very hard because it seems there is a ton of advice out there but very hard to work out what applies to me.

    i logged into my aviva account and you can change your investments and just a browse on the high risk
    i know this is probably a simple question but if i need to increase the pension pot to 500k how can i work out what my payments need to be.
    i will be mortgage free in 5/7years as im overpaying.
    right now i reckon i can put another 100 a month into my pension a month

    im sure the accountant said work put 10% into my account i will check tomorrow at work and ask him what my contributions are each month

    Fund name
    Aviva sector Risk Additional charges 1 Year 3 Year 5 Year
    Aviva Pensions AXA Framlington Emerging Markets S6 Emerging Market Equities 5 0.73% 25.8% 21.8% 27.5%
    Aviva Pensions BlackRock Aquila Emerging Markets Index Tracker S6 Emerging Market Equities 5 0.16% 33.2% 22.2% 31.6%
    Aviva Pensions BlackRock China S6 Emerging Market Equities 5 1.07% 3.1% 17.3% N/A
    Aviva Pensions Fidelity EMEA S6 Emerging Market Equities 5 1.14% 36.2% 17.3% 46.4%
    Aviva Pensions Fidelity Emerging Markets S6 Emerging Market Equities 5 1.03% 20.4% N/A N/A
    Aviva Pensions Invesco Perpetual Latin America S6 Emerging Market Equities 5 0.90% 48.1% -4.8% -10.0%
    Aviva Pensions JPM Emerging Europe Equity S6 Emerging Market Equities 5 0.78% 54.0% 3.5% 23.9%
    Aviva Pensions JPM Emerging Markets S6 Emerging Market Equities 5 0.83% 36.8% 27.4% 33.0%
    Aviva Pensions Jupiter China S6 Emerging Market Equities 5 1.09% 11.1% 19.8% 58.6%
    Aviva Pensions Schroder Global Emerging Markets S6 Emerging Market Equities 5 0.92% 33.5% 23.5% 36.2%
    Aviva Pensions T. Rowe Price Emerging Markets Eqty S6 Emerging Market Equities 5 1.17% N/A N/A N/A
    Aviva Pensions Threadneedle Latin America S6 Emerging Market Equities 5 0.94% 50.9% -4.3% -14.8%
    Listen to what people say, but watch what people what people do!!
    • AnotherJoe
    • By AnotherJoe 12th Mar 17, 2:40 PM
    • 6,824 Posts
    • 7,243 Thanks
    AnotherJoe
    • #6
    • 12th Mar 17, 2:40 PM
    • #6
    • 12th Mar 17, 2:40 PM
    thankyou for the replies. it seems i really still need to do alot of reading about pensions. very hard because it seems there is a ton of advice out there but very hard to work out what applies to me.

    i logged into my aviva account and you can change your investments and just a browse on the high risk
    i know this is probably a simple question but if i need to increase the pension pot to 500k how can i work out what my payments need to be.
    i will be mortgage free in 5/7years as im overpaying.
    right now i reckon i can put another 100 a month into my pension a month
    Originally posted by stolt
    Most likely (and almost certainly if you are a HRT payer), you'd be better advised to reduce or stop the pension mortgage overpayments and put the money into you and your wife's pensions instead.
    Last edited by AnotherJoe; 12-03-2017 at 7:14 PM.
    • xylophone
    • By xylophone 12th Mar 17, 3:01 PM
    • 21,979 Posts
    • 12,680 Thanks
    xylophone
    • #7
    • 12th Mar 17, 3:01 PM
    • #7
    • 12th Mar 17, 3:01 PM
    Consider opening a pension for your wife - it appears that she has no relevant earnings but can still contribute £2880 per annum to a pension scheme and the provider will claim £720 in tax relief.

    http://www.hl.co.uk/partners/search/sipp?theSource=PCHLS&Override=0&adg=G+HLBS+HLS&gcl id=CO_Q0bud0dICFUWNGwodjXsGRA

    http://monevator.com/category/investing/passive-investing-investing/
    • Triumph13
    • By Triumph13 12th Mar 17, 4:17 PM
    • 1,005 Posts
    • 1,186 Thanks
    Triumph13
    • #8
    • 12th Mar 17, 4:17 PM
    • #8
    • 12th Mar 17, 4:17 PM
    If that £20k pa is the spending level you want in retirement then stop panicking. Make sufficient voluntary NICs to get your wife a full SP - I'm assuming you will already achieve that yourself, but get forecasts and check.
    2 x full SP is £16k pa leaving you £4k short which would be covered by a fund of about £100k. Replacing the SP for the period from 60 to say 68 is roughly £150k so that's a £250 fund needed and you are well on your way to that.


    If you want £20k plus the state pensions then you may well need to save a bit harder (haven't run the numbers). As AnotherJoe meant to say, you may want to consider stopping overpayments to the mortgage and routing that money into the pension instead.
    • stolt
    • By stolt 12th Mar 17, 5:52 PM
    • 2,792 Posts
    • 1,206 Thanks
    stolt
    • #9
    • 12th Mar 17, 5:52 PM
    • #9
    • 12th Mar 17, 5:52 PM
    thanks for the replies. Ive just been talking to my dad and my wife again and we have three daughters that are under 15 so at some stage we are hoping they will go through university and then maybe help them with a deposit for a house etc
    i keep reading about how much money you will need, ive done several calculators that suggest i really should be looking at 27k pension which means me trying to increase my pension payments.

    think im having a brain meltdown.
    Listen to what people say, but watch what people what people do!!
    • AnotherJoe
    • By AnotherJoe 12th Mar 17, 7:16 PM
    • 6,824 Posts
    • 7,243 Thanks
    AnotherJoe
    As AnotherJoe meant to say, you may want to consider stopping overpayments to the mortgage and routing that money into the pension instead.
    Originally posted by Triumph13
    Oops yes. Corrected
    • AnotherJoe
    • By AnotherJoe 13th Mar 17, 8:55 AM
    • 6,824 Posts
    • 7,243 Thanks
    AnotherJoe
    i know this is probably a simple question but if i need to increase the pension pot to 500k how can i work out what my payments need to be.
    Originally posted by stolt
    Use a compound interest calculator to work out how much you'd need to save for 18 years to accumulate £150k (since you are already on track for £350k). Use 5% as the interest rate (fairly conservative). I make it around £450/month. Good news is, that is before tax so the difference in your pay packet would be anywhere from £350 to £250 or so depending if you are a high rate tax payer or not.
    • Triumph13
    • By Triumph13 13th Mar 17, 10:04 AM
    • 1,005 Posts
    • 1,186 Thanks
    Triumph13
    Okay, I finally have time to run the numbers and you may find them re-assuring. I don't know where you got your figure of £27k from and whether it was based on what you actually spend, or just some daft idea about 'everyone needs x% of their final salary', but let's assume it's a real number. Furthermore I'll assume it's an after-tax spending number, not a pre tax income.
    Other assumptions:
    • You pay whatever NICs are necessary to get each of you a full SP of £8,100 per year
    • Wife's other pensions ignored as trivial.
    • Investments grow at an average of 4% real
    • You continue to pay into your pension at your current rate, increasing contributions in line with inflation each year.
    • You retire at 60 and both get your SP 8 years later
    • At retirement you take the 25% tax free lump sum and hold it as cash to help cover the bridging period to SP. This just earns interest in line with inflation.
    • Remaining 75% remains invested earning 4%. You draw out your personal allowance each year until SP.
    • At SP what's left is used for drawdown at a 4% rate.
    In order to get your desired £27k spending, on the above assumptions, you need to increase your contributions by...nothing at all.
    18 years at your current rate gets you to a little over half a million. 25% of that gives you £15,500 a year for 8 years which added to the £11,500 pa drawn tax free from the rest gives you your £27k pa for that period. Investment growth on the remaining 3/4 would be expected to be more than the £11,500 drawn so that would actually keep increasing and be up to around £410k by age 68. 4% drawdown from that plus two lots of state pension gives you £30k pa after tax from then on.
    • stolt
    • By stolt 15th Mar 17, 10:35 PM
    • 2,792 Posts
    • 1,206 Thanks
    stolt
    thanks been looking at my wife and the state pension. I've read she needs 30 years NIC to obtain a state pension. She sbeen looking after our daughters for the last 10 years at home so i dont know if shes entitled to looking on the gov website it states. so i wonder if there is somewhere that can tell us how much she still needs to pay to get a state pension,

    Parents and foster carers

    Your situation on or after 6 April 2010 How to get credits You’re a parent registered for Child Benefit for a child under 12 (even if you don’t receive it) You get Class 3 credits automatically
    Listen to what people say, but watch what people what people do!!
    • stolt
    • By stolt 15th Mar 17, 10:49 PM
    • 2,792 Posts
    • 1,206 Thanks
    stolt
    well we have set my wife up a GOV account and logged in under credits so it seems she has 24 years of contributions so it seems she has to pay at least 9 years.
    one thing we did notice was it says she was contracted out
    You were contracted out

    In the past you’ve been part of one or more contracted out pension schemes, such as workplace or personal pension schemes.
    When you were contracted out:
    • you and your employers paid lower rate National Insurance contributions; or
    • some of your National Insurance contributions were paid into your private pension schemes instead
    Last edited by stolt; 15-03-2017 at 10:54 PM.
    Listen to what people say, but watch what people what people do!!
    • GunJack
    • By GunJack 16th Mar 17, 12:01 AM
    • 9,597 Posts
    • 7,162 Thanks
    GunJack
    well we have set my wife up a GOV account and logged in under credits so it seems she has 24 years of contributions so it seems she has to pay at least 9 years.
    one thing we did notice was it says she was contracted out
    You were contracted out

    In the past you’ve been part of one or more contracted out pension schemes, such as workplace or personal pension schemes.
    When you were contracted out:
    • you and your employers paid lower rate National Insurance contributions; or
    • some of your National Insurance contributions were paid into your private pension schemes instead
    Originally posted by stolt
    so you need to track down her c/o pension, or do you know who/what company it was with?
    ......Gettin' There, Wherever There is......
    • xylophone
    • By xylophone 16th Mar 17, 1:02 AM
    • 21,979 Posts
    • 12,680 Thanks
    xylophone
    What was shown as your wife's "starting amount" for NSP as at 6.4.16?

    And yours?
    • GunJack
    • By GunJack 16th Mar 17, 11:21 AM
    • 9,597 Posts
    • 7,162 Thanks
    GunJack
    well we have set my wife up a GOV account and logged in under credits so it seems she has 24 years of contributions so it seems she has to pay at least 9 years.
    Originally posted by stolt
    not necessarily, it depends on her starting amount as at 6 Apr 2016, what was that figure on the online checker??
    ......Gettin' There, Wherever There is......
    • stolt
    • By stolt 17th Mar 17, 10:35 PM
    • 2,792 Posts
    • 1,206 Thanks
    stolt
    hi sorry for not replying sooner, for some reason i dont get the notifications that anyone has replied.

    for my wife ive just checked online, i cant see a figure as such on there though
    Your National Insurance record

    Summary

    You have:
    • 24 years of full contributions
    • 24 years to contribute before 5 April 2040
    • 3 years when you did not contribute enough

    All years.
    2016-17
    Your record for this year is not available yet

    2015-16
    Full year
    You have contributions from
    National Insurance credits: 52 weeks
    These may have been added to your record if you were ill/disabled, unemployed, caring for someone full-time or on jury service.


    my wife has just googled the company and its been resolved. Not sure how we go about finding who controlled the pension scheme or is that kind of thing just gone. Do we need to contract her back in

    thanks for your patience with all the questions
    Last edited by stolt; 17-03-2017 at 10:52 PM.
    Listen to what people say, but watch what people what people do!!
    • mgdavid
    • By mgdavid 18th Mar 17, 1:52 AM
    • 5,172 Posts
    • 4,343 Thanks
    mgdavid
    .............
    my wife has just googled the company and its been resolved. Not sure how we go about finding who controlled the pension scheme or is that kind of thing just gone. Do we need to contract her back in

    thanks for your patience with all the questions
    Originally posted by stolt
    Do you mean dissolved?
    Try the pension tracing service
    https://www.gov.uk/find-pension-contact-details
    A salary slave no more.....
    • stolt
    • By stolt 18th Mar 17, 9:08 PM
    • 2,792 Posts
    • 1,206 Thanks
    stolt
    Do you mean dissolved?
    Try the pension tracing service
    https://www.gov.uk/find-pension-contact-details
    Originally posted by mgdavid

    i do, thankyou
    Listen to what people say, but watch what people what people do!!
Welcome to our new Forum!

Our aim is to save you money quickly and easily. We hope you like it!

Forum Team Contact us

Live Stats

248Posts Today

1,283Users online

Martin's Twitter
  • Byebye! I'm about to stop work & twitter, to instead spend glorious time with Mrs & mini MSE. Wishing u a lovely summer. See u in 10 days.

  • WARNING Did you start Uni in or after 2012? The interest's rising to 6.1%; yet it doesnt work like you think. See https://t.co/IQ8f0Vyetu RT

  • RT @JanaBeee: @MartinSLewis Boris is the anomaly (coffee), the others are versions of normal (beer). Lots of same candidates = vote share d?

  • Follow Martin