Pensions Planning: The NUMBER

Rhanaroo

michaels said:

There are plug in hybrids (outlander, eniro) that can tow.  If your use pattern is mostly short local trips you could do all of these on electric and then use petrol for the longer tow trips. 

The towing weights aren't very high. Certainly wouldn't tow my caravan

Sea_Shell

Rhanaroo said:

michaels said:

There are plug in hybrids (outlander, eniro) that can tow.  If your use pattern is mostly short local trips you could do all of these on electric and then use petrol for the longer tow trips. 

The towing weights aren't very high. Certainly wouldn't tow my caravan

Maybe the real incentive behind the electric vehicle revolution, is the effective banning of caravans!!

Seriously though, what do they think will pull a double axle caravan, uphill on the A34 at East Ilsley, on the way back from the south coast?

Bravepants

Sea_Shell said:

Rhanaroo said:

michaels said:

There are plug in hybrids (outlander, eniro) that can tow.  If your use pattern is mostly short local trips you could do all of these on electric and then use petrol for the longer tow trips. 

The towing weights aren't very high. Certainly wouldn't tow my caravan

Maybe the real incentive behind the electric vehicle revolution, is the effective banning of caravans!!

Seriously though, what do they think will pull a double axle caravan, uphill on the A34 at East Ilsley, on the way back from the south coast?

How about a team of these creepy-looking four-legged wonders?

https://www.youtube.com/watch?v=D_Vc_yDvU24

michaels

Rhanaroo said:

michaels said:

There are plug in hybrids (outlander, eniro) that can tow.  If your use pattern is mostly short local trips you could do all of these on electric and then use petrol for the longer tow trips. 

The towing weights aren't very high. Certainly wouldn't tow my caravan

Volvo xc90 T8 or Porsche Cayenne S E-Hybrid - or if you are at that price point how about a Tesla model X?

Sea_Shell

Bravepants said:

Sea_Shell said:

Rhanaroo said:

michaels said:

There are plug in hybrids (outlander, eniro) that can tow.  If your use pattern is mostly short local trips you could do all of these on electric and then use petrol for the longer tow trips. 

The towing weights aren't very high. Certainly wouldn't tow my caravan

Maybe the real incentive behind the electric vehicle revolution, is the effective banning of caravans!!

Seriously though, what do they think will pull a double axle caravan, uphill on the A34 at East Ilsley, on the way back from the south coast?

How about a team of these creepy-looking four-legged wonders?

https://www.youtube.com/watch?v=D_Vc_yDvU24

That seems a bit "War of the worlds"!!!

Rhanaroo

michaels said:

Rhanaroo said:

michaels said:

There are plug in hybrids (outlander, eniro) that can tow.  If your use pattern is mostly short local trips you could do all of these on electric and then use petrol for the longer tow trips. 

The towing weights aren't very high. Certainly wouldn't tow my caravan

Volvo xc90 T8 or Porsche Cayenne S E-Hybrid - or if you are at that price point how about a Tesla model X?

At those prices I wouldn't be able to afford to go on holiday!

gtat

Wow, what a thread! It's taken me a couple about 6 weeks to read the entirety (195 pages so far!), but I'm finally at the end. It's been really enlightening, and fantastic to hear so many different numbers and lifestyles. Particularly interesting reading the updates from posters a few years on from original posts, and also the impact of Covid over the last 15 months.

So.. what is my number?
My wife and I are 34, which means it is a bit difficult to predict at present. For example, we have a baby and hope to have another in the future - I have set up a JISA which I hope will contribute to some of the costs of sending them on their way, but I'm sure there will be additional costs which we will contribute to such as university, house, sports/interests and flying cars(!).
However, we are trying to plan ahead as much as possible. We have tracked our current expenditure for a few years and on that basis we currently think our number is approx. £36k per year. Between us we have very little in DC pensions (16k) but a bit more built up in DB pensions (around £7k from NPA). We are still at least 33 years from SPA, so hopefully plenty of time for those pension figures to increase.
We hope to retire by the age of 58, but there are a huge number of factors involved (kids, jobs, health). I'm thinking of setting up a SIPP to help bridge the gap between 58 and SPA. Essentially we have 24 years to build up a pot of at least £360k (preferably £450k) to allow us to live on our 'number' as retirees from 58 onwards.

DairyQueen

gtat said:

Wow, what a thread! It's taken me a couple about 6 weeks to read the entirety (195 pages so far!), but I'm finally at the end. It's been really enlightening, and fantastic to hear so many different numbers and lifestyles. Particularly interesting reading the updates from posters a few years on from original posts, and also the impact of Covid over the last 15 months.

So.. what is my number?
My wife and I are 34, which means it is a bit difficult to predict at present. For example, we have a baby and hope to have another in the future - I have set up a JISA which I hope will contribute to some of the costs of sending them on their way, but I'm sure there will be additional costs which we will contribute to such as university, house, sports/interests and flying cars(!).
However, we are trying to plan ahead as much as possible. We have tracked our current expenditure for a few years and on that basis we currently think our number is approx. £36k per year. Between us we have very little in DC pensions (16k) but a bit more built up in DB pensions (around £7k from NPA). We are still at least 33 years from SPA, so hopefully plenty of time for those pension figures to increase.
We hope to retire by the age of 58, but there are a huge number of factors involved (kids, jobs, health). I'm thinking of setting up a SIPP to help bridge the gap between 58 and SPA. Essentially we have 24 years to build up a pot of at least £360k (preferably £450k) to allow us to live on our 'number' as retirees from 58 onwards.

Your number in current value is £38kp.a. From age 68 you will receive £18k if you qualify for 2 x SPs. So, you need a pot to support an additional £20k p.a. from that age for a safe 30 year retirement. At current rates (and at a SWR of possibly 3%) you will need a pot of £20k x 25 years. So, £500k. In addition you will need to bridge the gap from  age 58 (another decade). That requires an additional £38k x 10 = £380k in drawdown.

Sorry to rain on your number but £360-£450k at age 58 won't even come close to supporting a (relatively high) retirement income of £38k. You will need a pot closer to 880k (current value) to come close to your retirement aspirations of retiring at 58.

gtat

DairyQueen said:

gtat said:

Wow, what a thread! It's taken me a couple about 6 weeks to read the entirety (195 pages so far!), but I'm finally at the end. It's been really enlightening, and fantastic to hear so many different numbers and lifestyles. Particularly interesting reading the updates from posters a few years on from original posts, and also the impact of Covid over the last 15 months.

So.. what is my number?
My wife and I are 34, which means it is a bit difficult to predict at present. For example, we have a baby and hope to have another in the future - I have set up a JISA which I hope will contribute to some of the costs of sending them on their way, but I'm sure there will be additional costs which we will contribute to such as university, house, sports/interests and flying cars(!).
However, we are trying to plan ahead as much as possible. We have tracked our current expenditure for a few years and on that basis we currently think our number is approx. £36k per year. Between us we have very little in DC pensions (16k) but a bit more built up in DB pensions (around £7k from NPA). We are still at least 33 years from SPA, so hopefully plenty of time for those pension figures to increase.
We hope to retire by the age of 58, but there are a huge number of factors involved (kids, jobs, health). I'm thinking of setting up a SIPP to help bridge the gap between 58 and SPA. Essentially we have 24 years to build up a pot of at least £360k (preferably £450k) to allow us to live on our 'number' as retirees from 58 onwards.

Your number in current value is £38kp.a. From age 68 you will receive £18k if you qualify for 2 x SPs. So, you need a pot to support an additional £20k p.a. from that age for a safe 30 year retirement. At current rates (and at a SWR of possibly 3%) you will need a pot of £20k x 25 years. So, £500k. In addition you will need to bridge the gap from  age 58 (another decade). That requires an additional £38k x 10 = £380k in drawdown.

Sorry to rain on your number but £360-£450k at age 58 won't even come close to supporting a (relatively high) retirement income of £38k. You will need a pot closer to 880k (current value) to come close to your retirement aspirations of retiring at 58.

Thanks DQ. Sorry if I wasn't clear - £7k pa in DB schemes is what I have already accrued. Assuming I keep the same job/salary (and no changes to the scheme) then this would be £36k by the time I hope to retire at 58. They are of course big assumptions- I'm sure things will change one way or the other over the next 24 years. 

Therefore I don't anticipate needing any DC/ SIPP beyond having bridged 'the gap' from 58 to 68. 

DairyQueen

gtat said:

DairyQueen said:

gtat said:

Wow, what a thread! It's taken me a couple about 6 weeks to read the entirety (195 pages so far!), but I'm finally at the end. It's been really enlightening, and fantastic to hear so many different numbers and lifestyles. Particularly interesting reading the updates from posters a few years on from original posts, and also the impact of Covid over the last 15 months.

So.. what is my number?
My wife and I are 34, which means it is a bit difficult to predict at present. For example, we have a baby and hope to have another in the future - I have set up a JISA which I hope will contribute to some of the costs of sending them on their way, but I'm sure there will be additional costs which we will contribute to such as university, house, sports/interests and flying cars(!).
However, we are trying to plan ahead as much as possible. We have tracked our current expenditure for a few years and on that basis we currently think our number is approx. £36k per year. Between us we have very little in DC pensions (16k) but a bit more built up in DB pensions (around £7k from NPA). We are still at least 33 years from SPA, so hopefully plenty of time for those pension figures to increase.
We hope to retire by the age of 58, but there are a huge number of factors involved (kids, jobs, health). I'm thinking of setting up a SIPP to help bridge the gap between 58 and SPA. Essentially we have 24 years to build up a pot of at least £360k (preferably £450k) to allow us to live on our 'number' as retirees from 58 onwards.

Your number in current value is £38kp.a. From age 68 you will receive £18k if you qualify for 2 x SPs. So, you need a pot to support an additional £20k p.a. from that age for a safe 30 year retirement. At current rates (and at a SWR of possibly 3%) you will need a pot of £20k x 25 years. So, £500k. In addition you will need to bridge the gap from  age 58 (another decade). That requires an additional £38k x 10 = £380k in drawdown.

Sorry to rain on your number but £360-£450k at age 58 won't even come close to supporting a (relatively high) retirement income of £38k. You will need a pot closer to 880k (current value) to come close to your retirement aspirations of retiring at 58.

Thanks DQ. Sorry if I wasn't clear - £7k pa in DB schemes is what I have already accrued. Assuming I keep the same job/salary (and no changes to the scheme) then this would be £36k by the time I hope to retire at 58. They are of course big assumptions- I'm sure things will change one way or the other over the next 24 years. 

Therefore I don't anticipate needing any DC/ SIPP beyond having bridged 'the gap' from 58 to 68. 

Apologies, I missed the DB membership. Will your DB pay £36kp.a. in today's terms? i.e. will it revalue to allow for inflation over time? Or is £36k a projection that includes inflation (salary increase?) of x% p.a. over the next 24 years? I ask as, your number will increase by inflation so will be significantly higher by the time you reach 58 and your projected income needs to match it in real terms. 

£36kp.a. (current value) is a generous DB entitlement. For example, it would require 40 years membership of a 1/60th scheme at final salary of approx £55k (also current value) to achieve that. A high earner (say £110kp.a.) could achieve the same amount from 20 years membership of the same scheme.

Simplistic numbers but you get the drift.

It's great that you are planning in your 30s. Nobody reaches their 50s regretting having planned early but plenty regret planning too late. Those of us that have made it across the line with sufficient income for a comfy retirement either planned early or got lucky. No prizes for guessing which camp most belong to. 

Very best wishes on the new babe; the best investment you will ever make.