Pensions Planning: The NUMBER

zarazara

exil wrote: »

Are you sure? What about SERPS/S2P? If you've been working in jobs without occupational pension schemes you'll be entitled to this.
Get a pension forecast from the DWP. It's quite possible you'll have the 16k between you but you need to find out.

nope. I am a housewife and DH work doesnt provide any pension. Not to worry,have thought about it all,we are starting to grow our own veg and buy things second hand. I have been at home for 20+ years and although I found myself a little part time job it just wasnt worth it,being told what to do ,paid minimum wage and travel expenses. And the house was going to pot and DH having to help with washing and shopping and housework. I thought this unfair as he does work full time and that stuffs my job!
So, the plan is to be as self suffiecent as possible with food and have only 1 car in the future to save money.

Herbie_Hancock_I_wish

New here. Read the thread and how very interesting it is. A couple of things strike me. Firstly a decade of rubbish on the stock markets and also a dreadful fall in annuities. We were planning on about £15k in private pensions yet we will see, if we are lucky a thirdish of that. Now we also have look at the lack of interest return people are getting on their savings. My Mum and Dads age group often relied in part on that. Gone!!! In my humble opinion the only investment that has done well is the property bubble.

Again, only my opinion, that has been kept going by the drop in IRs. A shameful decade.

So what`s my number? Well as someone else said, provided nothing awful happens I would like to think for 2 of us about £24k a year post tax. Made up by state pensions, about £14k hopefully with serps, private and old company pensions, maybe £6k and then a draw down off of savings of about £4k a year.

Looking at the latter, when savings rates were a " huge " 5%, we could have drawn down, over 20 years an amount of £8k or so a year.

Gatser

Herbie_Hancock_I_wish wrote: »

So what`s my number? Well as someone else said, provided nothing awful happens I would like to think for 2 of us about £24k a year post tax. Made up by state pensions, about £14k hopefully with serps, private and old company pensions, maybe £6k and then a draw down off of savings of about £4k a year.
Looking at the latter, when savings rates were a " huge " 5%, we could have drawn down, over 20 years an amount of £8k or so a year.

Yes... it's a rather sad situation ... and looks likely to continue for some time. I do not expect high returns in my planning...

Our NUMBER is still in the £22-28k range... I am reluctantly prepared to work (p/t) until 70 if we need to supplement pension/savings income. I may see a few of you in B&Q too! :rotfl:

Once we know our NUMBER... the big challenge is to have enough capital to fund it!

brianrhill

I worked out that £50k a year would be satisfactory, which would mean £1.25m pot in today's money. That was fine, but then I worked out that if I wanted to be able to retire, if i chose to, at 55, I only have 168 pay days to do it in. which means I need to start effectively putting away £4,464, index linked, into my pension, and get some decent growth going!! Wow.

Gatser

brianrhill wrote: »

I worked out that £50k a year would be satisfactory, which would mean £1.25m pot in today's money. That was fine, but then I worked out that if I wanted to be able to retire, if i chose to, at 55, I only have 168 pay days to do it in. which means I need to start effectively putting away £4,464, index linked, into my pension, and get some decent growth going!! Wow.

I would say you could drawdown at a rate higher than 4% on the £1.25m you suggest.
From age 60 I plan to drawdown at 6%, even if investment returns are only at 3%
Do you agree?

Debt_Free_Chick

Gatser wrote: »

I would say you could drawdown at a rate higher than 4% on the £1.25m you suggest.
From age 60 I plan to drawdown at 6%, even if investment returns are only at 3%
Do you agree?

If investment returns are 3% pa and you're drawing off 6% pa as an income, then you are drawing off some of the capital.

On the face of it, this is not necessarily a problem. However, if you live too long, then you could find that you run out of capital (in theory - in practice the GAD drawdown rates actually work to prevent this situation).

What's interesting is .... you think that an annuity with a guaranteed income at 3% of the capital is a bad idea. But your example shows that your current situation (drawing off 6% when the return is only 3%) is not sustainable.

It may be right for you, but that doesn't make it right for everyone else

Gatser

Debt_Free_Chick wrote: »

(1)If investment returns are 3% pa and you're drawing off 6% pa as an income, then you are drawing off some of the capital.

(2)What's interesting is .... you think that an annuity with a guaranteed income at 3% of the capital is a bad idea. But your example shows that your current situation (drawing off 6% when the return is only 3%) is not sustainable.

(3)It may be right for you, but that doesn't make it right for everyone else

(1) Yep! I want my capital back too....it's mine!
Unlike Annuities that pay rubbish returns AND keep your capital

(2) "Not sustainable"? ...depends on what your NUMBER is!

(3) Never said it was. Just my humble opinion/view

brianrhill

Gatser wrote: »

I would say you could drawdown at a rate higher than 4% on the £1.25m you suggest.
From age 60 I plan to drawdown at 6%, even if investment returns are only at 3%
Do you agree?

withdrawing 4% seems to be an acceptable level to me! I'm not overly keen on drawdown, and 4% also gives me room to ensure that as I get older, I can start to move cash to beneficiaries so I kick the bucket with around about £0 :A

Gatser

brianrhill wrote: »

withdrawing 4% seems to be an acceptable level to me! I'm not overly keen on drawdown, and 4% also gives me room to ensure that as I get older, I can start to move cash to beneficiaries so I kick the bucket with around about £0 :A

Don't want you kicking those buckets Brian... but if you arrange things to finish at ZERO... Well done!

I am interested that, as an IFA, you are not keen on drawdown... what's your preferred pension route please?

thanks

maggieann155

i've been thinking about the amount we would need for a replacement fund in retirement.
does anyone have a basic NUMBER for replacing items such as a car, boiler, washing machine etc? and where do you/would you keep such funds?

in our particular circumstances i' d thought

car £6000
washer £350
fridge £350
pc £500
camper £1500
tv £600
boiler £2000
hi fi £500

total £12200
anything important i've missed?

would you save this amount or perhaps double for 2 replacements over retirement?
or put money back after initial replacement from retirement income?

you re thoughts /suggestions greatly appreciated.