Pensions for dummies...

scottishsuz

Hi Folks,

I've just depressed myself with the retirement age calculator, at the moment under current rules I'll be able to claim a state pension when I'm 68. As I've just turned 27, the thought of working for another 41 years isn't appealing.

I currently a member of a LGPS so I'm aware that I might be able to retire earlier and claim that, but it probably won't be enough to live on.
My aim is to make retirement as comfortable as possible (my gran travels the world and I'd like to be able to do the same one day). I started this pension 6 years ago and am likely to stay in the local goverment sector of employment for the forseeable future.

My question is, in simple terms please (pensions confuse the heck out of me) for someone who is earning a smidge over £20K is there a safe, easy to understand pension out there that will help me achieve a comfortable retirement? Aside from a shoebox under the bed of course

Thanks in advance,

Scottishsuz

Darts

I would say stay in the LGPS, especially as you've been in it for 6 years already and plan to stay there for the forseeable future. It would be very hard to match the value of LGPS benefits in a private scheme with the same level of personal contribution.

It's hard to know what else to suggest other than the usual MSE stuff of clearing expensive debts and maxmising Cash ISA allowances etc before investing long term.

scottishsuz

Thanks, I'm definately staying in the LGPS, and working to pay off as much debt as I can. I haven't maximised and cash ISAs yet, but that has given me something to think about.

dunstonh

If you are looking to fund the shortfall in income between early retirement and state retirement, then stocks and share ISAs are the main consideration at your age.

chesky369

You're fortunate in being in probably one of the best schemes there is, so by the time you get around to retiring, you will be in a very good position. I didn't start my pension until I was in my 40s but because it was a good final salary scheme, and because I also took out additional pension savings (stakeholder and AVCs), I'm able to live quite comfortably without even touching my state pension which goes straight into a savings account for things like new furniture, etc. So don't start getting into a panic - you may well be able to retire early and view the state pension as the icing on the cake - nice but not necessary.

scottishsuz

Thanks for the answers folks. Its good to be reassured that early retirement will be a possibility.