How much money do you keep as rainy day fund?

Idiophreak

I've got nothing, but a whole bunch of CCs - is that a bad thing?

I don't see myself ever saving years' worth. If I had four years of savings, I'd probably just take three years off work and put my feet up

Vincenzo

Really2 wrote: »

I froze my pensions, I also stopped playing the national lottery. I could see neither paying out that much come 65.:)

Interesting comment re pension. The more you put in, the more it will pay out!

I think a lot of people in future will regret not utilising pensions more. The tax benefits on contribution coupled with the likely growth is a no brainer, although slightly soured by the need to purchase an annuity at the end (which is unlikely to be the case much longer). Many argue the tax is simply deferred to retirement but you will have larger allowances and possibly be in a lower tax band then. I am quite happy to get 40% relief now and pay 20% later!

Exocet

I have plenty to last six and a half hours if I cut the fags out.

Really2

Vincenzo wrote: »

Interesting comment re pension. The more you put in, the more it will pay out!

I guess we will see at 65, I am just in the opinion now I am more happy with my retirement being controlled by me.

Also should anything happen before the fruits of my labour are available to my next of kin or if out of work they will not freeze.

I personally do not think pensions will be as good for my generations as previous ones.

Vincenzo

Really2 wrote: »

I guess we will see at 65, I am just in the opinion now I am more happy with my retirement being controlled by me.

Also should anything happen before the fruits of my labour are available to my next of kin or if out of work they will not freeze.

I personally do not think pensions will be as good for my generations as previous ones.

Each to their own, as they say. I would never advocate reliance on one product or asset class however I think the assumption by many that pensions have had their day is wrong. Mine forms a very important part of my retirement planning and I have well over 30 years to retirement. I do not accept the argument about control and my funds would pass to my next of kin in the event of my death.

wageslave

Idiophreak wrote: »

I've got nothing, but a whole bunch of CCs - is that a bad thing?

I don't see myself ever saving years' worth. If I had four years of savings, I'd probably just take three years off work and put my feet up

TBH so would I:cool:

Really2

Vincenzo wrote: »

I do not accept the argument about control and my funds would pass to my next of kin in the event of my death.

But when would they get it? also how will it freezing make a difference to what was planed?

As you say each to their own you don't have to accept what I say I have just said what I am planing. As I said around 50 I will have a lot of money and spare cash to invest (all going well).
But if it goes in to savings, shares or heaven fordbid a BTL for a monthly income is neither here nor there.
If I can raise the cash funds I am planing in today's terms even without investment I should have a reasonably comfortable retirement.

I can't see a problem doing that, I am not asking anyone else to do it or saying it is right. It is just my preference.

PasturesNew

Vincenzo wrote: »

Interesting comment re pension. The more you put in, the more it will pay out!

Not entirely true. There are a lot of people whose pension pots, after 10-20 years now, are less than the ££s they put into them. Might as well have not bothered.

Also, for many, if you look at pension credit, it guarantees a minimum income ... so first, you have to guarantee that aaaallll your savings will come to more than that amount of top up, else you'll just not get PC and so you'll have effectively scrimped to waste your money.

Vincenzo wrote: »

I think a lot of people in future will regret not utilising pensions more. The tax benefits on contribution coupled with the likely growth is a no brainer, although slightly soured by the need to purchase an annuity at the end (which is unlikely to be the case much longer). Many argue the tax is simply deferred to retirement but you will have larger allowances and possibly be in a lower tax band then. I am quite happy to get 40% relief now and pay 20% later!

I had some advice here on MSE (edinvestor probably) that amounted to: If you are not a higher rate taxpayer - and if your employer doesn't pay into a pension .... it's really probably not worth bothering.

PasturesNew

Idiophreak wrote: »

If I had four years of savings, I'd probably just take three years off work and put my feet up

I've just done that, but by accident. I thought I'd be finding a job, but I never get a call.... so it's been awhile now ... 3 years in fact.

It's brilliant. I can thoroughly recommend it.

Vincenzo

PasturesNew wrote: »

Not entirely true. There are a lot of people whose pension pots, after 10-20 years now, are less than the ££s they put into them. Might as well have not bothered.

Also, for many, if you look at pension credit, it guarantees a minimum income ... so first, you have to guarantee that aaaallll your savings will come to more than that amount of top up, else you'll just not get PC and so you'll have effectively scrimped to waste your money.


I had some advice here on MSE (edinvestor probably) that amounted to: If you are not a higher rate taxpayer - and if your employer doesn't pay into a pension .... it's really probably not worth bothering.

Granted there are no guarantees with investments but I think what is worrying is that many people pick up on the negative press re pensions and use it as an excuse not to make any sensible provisions. It is rather like the argument that interest rates are so low it is not worth saving.