Pensions Planning: The NUMBER

MeteredOut

enthusiasticsaver said:

MeteredOut said:

enthusiasticsaver thanks for that - its really interesting to hear the reality compared to what you thought 10 years ago!

Would you be able to share the split of investments you have over DB Pension, DC Pension, SIPP and stocks and shares? eg, what % does each contribute to your health £5K per month.

Congrats on what you've done - it sounds like you're having a happy and healthy retirement!

Thanks for that and yes looking back on my post 10 years ago it is interesting what I thought we would need.  

DB Pensions for us each month are £3500 approx so 70% of our income. 
DHs DB pension is exactly 50% of our total income so £2500 and mine is £1000 as I worked part time to bring up children.  

The other 30% come from a combination of SIPPs, DC pension (mine) and Stocks and Shares ISA (again mainly mine) 

I draw on my Sipp, stocks and shares ISA and DC pension to the tune of £1500 (mainly ISA to minimise tax paid ) 

Thanks, interesting (but perhaps not surprising) that the DB pensions account for such a high percentage of your income, something that will be increasingly not the case in future years (other than the still much-sought after public sector pensions, where they still exist).

Roger175

Our expenses have been somewhat distorted and difficult to track for the last few years as we have been undertaking a self-build (a proper self-build where it's been mostly just me working my guts out every evening/weekend). Consequently we have been living between houses and with an abnormal spending pattern.

We have however now been settled into the new place for a few years and so we have undertaken a detailed record of expenditure for the last year. Things are still a bit distorted, since although the house is largely finished we are still working on the landscaping etc and although we've adjusted for the bigger purchases, there are lots of other costs hidden within the expenditure. Another cost is that we run a 3rd car, which is an old estate car which is basically a builder's wagon, but is still needed to collect materials and ferry stuff to the tip etc - still works out much cheaper than skips.

Anyway, our detailed expenditure for the last year is as follows:-

Bird food				£       186.93
Cars x 3 (incl insurance, tax, MOTs, servicing/repairs)				£    2,376.78
Petrol/Diesel				£    2,583.04
Clothes				£       960.96
Craft				£         73.36
Dentist				£       956.54
General				£    1,586.83
Gifts				£    1,803.40
Holidays and going out				£    5,070.55
House maintenance & Garden				£    4,884.10
Dog (incl food and vet bills etc)				£    1,500.90
Phones/Broadband				£       633.87
TV/spotify/netflix etc				£       225.81
Insurance (Buildings/contents and life insurance on me)				£       727.33
Council Tax/Utilities				£    4,958.68
Charities (various incl national trust membership for 1)				£       202.18
Personal and health ( incl hair, optitions, prescriptions)				£    1,176.38
Supermarket spend				£    4,855.54
Total				£   34,763.18

We are more or less retired now, ages 59/60 and leading up to this, we had estimated our number as being £30k. Therefore we were a bit surprised to find it's more like £35k, but I had stress tested the retirement plan way past this, so there are no real concerns. 

michaels

Roger175 said:

Our expenses have been somewhat distorted and difficult to track for the last few years as we have been undertaking a self-build (a proper self-build where it's been mostly just me working my guts out every evening/weekend). Consequently we have been living between houses and with an abnormal spending pattern.

We have however now been settled into the new place for a few years and so we have undertaken a detailed record of expenditure for the last year. Things are still a bit distorted, since although the house is largely finished we are still working on the landscaping etc and although we've adjusted for the bigger purchases, there are lots of other costs hidden within the expenditure. Another cost is that we run a 3rd car, which is an old estate car which is basically a builder's wagon, but is still needed to collect materials and ferry stuff to the tip etc - still works out much cheaper than skips.

Anyway, our detailed expenditure for the last year is as follows:-

Bird food				£       186.93
Cars x 3 (incl insurance, tax, MOTs, servicing/repairs)				£    2,376.78
Petrol/Diesel				£    2,583.04
Clothes				£       960.96
Craft				£         73.36
Dentist				£       956.54
General				£    1,586.83
Gifts				£    1,803.40
Holidays and going out				£    5,070.55
House maintenance & Garden				£    4,884.10
Dog (incl food and vet bills etc)				£    1,500.90
Phones/Broadband				£       633.87
TV/spotify/netflix etc				£       225.81
Insurance (Buildings/contents and life insurance on me)				£       727.33
Council Tax/Utilities				£    4,958.68
Charities (various incl national trust membership for 1)				£       202.18
Personal and health ( incl hair, optitions, prescriptions)				£    1,176.38
Supermarket spend				£    4,855.54
Total				£   34,763.18

We are more or less retired now, ages 59/60 and leading up to this, we had estimated our number as being £30k. Therefore we were a bit surprised to find it's more like £35k, but I had stress tested the retirement plan way past this, so there are no real concerns. 

I guess 30k 2 years ago is equivalent to 35k today with inflation.  So glad I have some fully index linked DB as even with the recent market rally they are still down in real terms over the last 2 or 3 years.

enthusiasticsaver

MeteredOut said:

enthusiasticsaver said:

MeteredOut said:

enthusiasticsaver thanks for that - its really interesting to hear the reality compared to what you thought 10 years ago!

Would you be able to share the split of investments you have over DB Pension, DC Pension, SIPP and stocks and shares? eg, what % does each contribute to your health £5K per month.

Congrats on what you've done - it sounds like you're having a happy and healthy retirement!

Thanks for that and yes looking back on my post 10 years ago it is interesting what I thought we would need.  

DB Pensions for us each month are £3500 approx so 70% of our income. 
DHs DB pension is exactly 50% of our total income so £2500 and mine is £1000 as I worked part time to bring up children.  

The other 30% come from a combination of SIPPs, DC pension (mine) and Stocks and Shares ISA (again mainly mine) 

I draw on my Sipp, stocks and shares ISA and DC pension to the tune of £1500 (mainly ISA to minimise tax paid ) 

Thanks, interesting (but perhaps not surprising) that the DB pensions account for such a high percentage of your income, something that will be increasingly not the case in future years (other than the still much-sought after public sector pensions, where they still exist).

Yes we focused quite aggressively on my DHs DB pension as he had a booster scheme offered to him when he started work as a 24 year old.  Given my Dad died around the same time at the age of 62 with no retirement we decided to go for the top pension scheme aimed at him retiring early as he travelled a lot for work and did long erratic hours.  I asked him if he thought he would still want to do that in his 60s and unsurprisingly he said no so we made the decision to overpay in the region of 8% of his salary and his employer paid 8% too. So that percentage going in monthly really ramped up the benefits.  The DB pension scheme was withdrawn in 2012 (4 years prior to him retiring).  As a sweetener the company moved to a DC scheme and said anyone who put in 10% of their salary would attract an employer contribution of 20% per annum reducing on a sliding scale for the next 4 years when it would cease so 30% of his salary was going into his pension for the final 4 years and the DB benefits were frozen.  It was much higher than we expected.  Mine is a public sector pension as you rightly predicted.  Those schemes will not be available to our children and we have encouraged ours to overpay theirs. 

enthusiasticsaver

Roger175 said:

Our expenses have been somewhat distorted and difficult to track for the last few years as we have been undertaking a self-build (a proper self-build where it's been mostly just me working my guts out every evening/weekend). Consequently we have been living between houses and with an abnormal spending pattern.

We have however now been settled into the new place for a few years and so we have undertaken a detailed record of expenditure for the last year. Things are still a bit distorted, since although the house is largely finished we are still working on the landscaping etc and although we've adjusted for the bigger purchases, there are lots of other costs hidden within the expenditure. Another cost is that we run a 3rd car, which is an old estate car which is basically a builder's wagon, but is still needed to collect materials and ferry stuff to the tip etc - still works out much cheaper than skips.

Anyway, our detailed expenditure for the last year is as follows:-

Bird food				£       186.93
Cars x 3 (incl insurance, tax, MOTs, servicing/repairs)				£    2,376.78
Petrol/Diesel				£    2,583.04
Clothes				£       960.96
Craft				£         73.36
Dentist				£       956.54
General				£    1,586.83
Gifts				£    1,803.40
Holidays and going out				£    5,070.55
House maintenance & Garden				£    4,884.10
Dog (incl food and vet bills etc)				£    1,500.90
Phones/Broadband				£       633.87
TV/spotify/netflix etc				£       225.81
Insurance (Buildings/contents and life insurance on me)				£       727.33
Council Tax/Utilities				£    4,958.68
Charities (various incl national trust membership for 1)				£       202.18
Personal and health ( incl hair, optitions, prescriptions)				£    1,176.38
Supermarket spend				£    4,855.54
Total				£   34,763.18

We are more or less retired now, ages 59/60 and leading up to this, we had estimated our number as being £30k. Therefore we were a bit surprised to find it's more like £35k, but I had stress tested the retirement plan way past this, so there are no real concerns. 

It probably is nearer £30k once you have stopped the house renovation and got rid of the third car.  Always best to over deliver anyway and with inflation best to err on the side of caution. Do you use any software to track your expenditure?

Roger175

enthusiasticsaver, yes, my wife uses Spending Tracker (pro) to track all expenditure.

saucer

enthusiasticsaver said:

I am bumping this thread to get it back to the top of the forum and bring back on topic.  

Just checked on here and in 2014 3 years before I retired and 10 years ago I posted on here saying we needed £25k to survive and it was too late to start a SIPP given I only had 3 years before I left work. Oh how things change. 

We in fact did retire in 2016 and 2018 (both 58 years old ) and although the income did not kick in all at the same time and we still are waiting on state pensions we are in the comfortable category when it comes to pension living standards categories. In the end we retired initially on £30k for a couple. Now our income is approx £2500 each per month so £5k in total.  That will increase by around £1k each when our state pensions pay out later on this year and early in 2026. That is a mix of DB pensions, DC pension, SIPP, stocks and shares ISAs. We live comfortably off that and indeed are still saving and we gift a lot so we could survive on a lot less. Our drawdown percentage on SIPPS, stocks and shares ISAs and DC pension is about 4%. 

Thank you enthusiasticsaver for all the great detail. We’re still 2+ years off but getting there. We’ll be on a bit more pension than you, predominately DB, but will probably spend more, especially on holidays and the planned motorhome, the latter being supposedly an expensive way to have a cheap holiday. 

One question is whether you have a specific plan or pool of saving for big spends, new roof, bathroom etc or does that come from DC and/or saving? It’s been discussed before but I am still wondering how much of an emergency or big ticket fund we should aim for when having a good and reliable DB income. 

Phossy

saucer said:

enthusiasticsaver said:

I am bumping this thread to get it back to the top of the forum and bring back on topic.  

Just checked on here and in 2014 3 years before I retired and 10 years ago I posted on here saying we needed £25k to survive and it was too late to start a SIPP given I only had 3 years before I left work. Oh how things change. 

We in fact did retire in 2016 and 2018 (both 58 years old ) and although the income did not kick in all at the same time and we still are waiting on state pensions we are in the comfortable category when it comes to pension living standards categories. In the end we retired initially on £30k for a couple. Now our income is approx £2500 each per month so £5k in total.  That will increase by around £1k each when our state pensions pay out later on this year and early in 2026. That is a mix of DB pensions, DC pension, SIPP, stocks and shares ISAs. We live comfortably off that and indeed are still saving and we gift a lot so we could survive on a lot less. Our drawdown percentage on SIPPS, stocks and shares ISAs and DC pension is about 4%. 

Thank you enthusiasticsaver for all the great detail. We’re still 2+ years off but getting there. We’ll be on a bit more pension than you, predominately DB, but will probably spend more, especially on holidays and the planned motorhome, the latter being supposedly an expensive way to have a cheap holiday. 

One question is whether you have a specific plan or pool of saving for big spends, new roof, bathroom etc or does that come from DC and/or saving? It’s been discussed before but I am still wondering how much of an emergency or big ticket fund we should aim for when having a good and reliable DB income. 

I expect any emergency fund requirements post retirement would be the same as pre-retirement. Most people manage without  one I think...

WYSPECIAL

saucer said:

enthusiasticsaver said:

I am bumping this thread to get it back to the top of the forum and bring back on topic.  

Just checked on here and in 2014 3 years before I retired and 10 years ago I posted on here saying we needed £25k to survive and it was too late to start a SIPP given I only had 3 years before I left work. Oh how things change. 

One question is whether you have a specific plan or pool of saving for big spends, new roof, bathroom etc or does that come from DC and/or saving? It’s been discussed before but I am still wondering how much of an emergency or big ticket fund we should aim for when having a good and reliable DB income. 

Do you have a fund earmarked for emergencies now?
If your income in retirement is going to exceed £60k per annum do you really need a pot of money set aside for a new rooftop you will probably never need?
Its whatever make sure you comfortable but if most of your spending is going to be discretionary is it something you need to worry about?

NoMore

With a DC pot, surely a emergency fund is redundant ? You have access to your entire portfolio for an emergency.

Emergency funds make sense as your accumulating and only getting a monthly wage, can't see the point when deccumulating. Especially since one of the major drivers of emergency funds is if you lose your job, which of course is meaningless in retirement.