Help im thick

SallyG

LM wrote : "I don't know what planet you come from, but in UK, you have to put around 25% of your gross salary - each year- into a pension plan in order to obtain a pension of roughly 67% of your salary when you retire."
Isn't around 10% the norm for occupational defined contribution schemes where the employer contributes?

hugheskevi

Hi, given that the projections are realistic then as you say you would get £11,000 from those pensions and by then the universal flat rate state pension ,on todays proposed figures, of £7280.( £140x52 ). So , on todays figures around £18-£19,000.

The OP has a lot of contracted-out pension, so based on what has been included in papers released so far mentioning contracted-out deductions the OP is unlikely to get £140 p/w State Pension.

LM wrote : "I don't know what planet you come from, but in UK, you have to put around 25% of your gross salary - each year- into a pension plan in order to obtain a pension of roughly 67% of your salary when you retire."
Isn't around 10% the norm for occupational defined contribution schemes where the employer contributes?

Yep, 10% is about average (about 6.5 employer, 3.5% employee)

Whether that is enough to get 67% depends on the age a person starts contributing, their salary level and when they want to commence the pension.

10% might well be enough for someone starting contributions when young on a lifetime low salary and not commencing the pension until State Pension age. The later starting contributions is left, the higher one's earnings and the earlier the pension is commenced the required contribution rate escalates - I'd think 25% is a reasonable first stab without any specific circumstances being given.

keith1950

Hi, percentages aren't much use if your on a low wage.

I have been told that to get any sort of usefull pension you need to pay at least £250-£300/month ( thats the combined contribution of employee and employer.

Shimrod

SallyG wrote: »

Isn't around 10% the norm for occupational defined contribution schemes where the employer contributes?

Average employer contributions are around 6.1% http://www.statistics.gov.uk/cci/nugget.asp?id=1278 (I've also seen 6.4% quoted which is very similar). Travel and retail industries seem to be least generous, with as little as 3%, whilst unsurprisingly, the Finance sector is most generous around 15%. Add in an employee contribution to the pension, and 10% as an average 'sounds' right.

keith1950

As far as the contracted out contribution question is corcerned, we still don't know the full details of how this will work, but he will probably retire well after the new scheme has been brought in, we can only judge on present situation. Time will tell.

JoeCrystal

keith1950 wrote: »

Hi, percentages aren't much use if your on a low wage.

I have been told that to get any sort of usefull pension you need to pay at least £250-£300/month ( thats the combined contribution of employee and employer.

Well, to be fair, if you are worker on minimum wage on forty hours per week. You would get gross income of £12,334.40.

Twenty five percent of that is roughly £256.97 per month, which kinda match what you been told is the minimum requirement toward any sort of useful pension at the very least.

Of course, can people on that income afford that amount with or without employer's contribution is another question.