How much should i have at 55?

dunstonh

well, ive been paying into a pension since i was 22. i pay in £120 per month and my company match it. i have £20,000 in there at the moment, but based on your projections i will need over 100k in there to have a 'reasonable' retirement, is this correct

A rule of thumb is to aim for £35k by age 35.

£100k will provide around £5k p.a. Add the basic state pension of £5k to that and you have £10k a year.

There is no way that many people have that kind of money to look forward to. The pension systems are awful, but its not to late because there are other ways to save for your pension. Through properties or gold. Plus you will have the state pension. Albeit not a lot. It seems that many people entering retirement are living on the poverty line and it is worrying.

Rubbish. It doesnt really matter if its in pensions, ISAs, gold or savings account or property at the end of the day. If you only have £20k in any of those, then its not going to be enough.

james3333

dunstonh wrote: »

A rule of thumb is to aim for £35k by age 35.

£100k will provide around £5k p.a. Add the basic state pension of £5k to that and you have £10k a year.



Rubbish. It doesnt really matter if its in pensions, ISAs, gold or savings account or property at the end of the day. If you only have £20k in any of those, then its not going to be enough.

hi,
i have 20k in there , but im 32 years old, not 55
as i look at the calculator, i see as it stands i will be getting 9k a year! no wonder no one bothers to pay into 'em any more.
bust a gut at 22 years old to pay into one until you retire then get 9k a year? pfffst. looks like i will be downsizing house.

somethingcorporate

I asked before, not saw if you caught it but up to what amount do your company match? It's free money so grab it with both hands if you can.

james3333

somethingcorporate wrote: »

I asked before, not saw if you caught it but up to what amount do your company match? It's free money so grab it with both hands if you can.

yeh, saw it........i put in £120 and theyput in £120.... so i think/thought that was good!

somethingcorporate

james3333 wrote: »

yeh, saw it........i put in £120 and theyput in £120.... so i think/thought that was good!

It's good considering you get some free money but do they match any higher? In my company I pay in 7% and they give me 9% contribution.

At the moment it seems you put in 4.5% and they match it. If they match any higher you should consider increasing your contribution up to their matched as this is the best return you will ever get on your money!

I did point out that you get out what you put in. £240 a month is quite a small amount but you have done well to save £20k so far. If you can put away what you can you will see it continue to grow.

Good luck!

james3333

somethingcorporate wrote: »

It's good considering you get some free money but do they match any higher? In my company I pay in 7% and they give me 9% contribution.

At the moment it seems you put in 4.5% and they match it. If they match any higher you should consider increasing your contribution up to their matched as this is the best return you will ever get on your money!

I did point out that you get out what you put in. £240 a month is quite a small amount but you have done well to save £20k so far. If you can put away what you can you will see it continue to grow.

Good luck!

thanks!...yeh , they will only match up to 5% so im nearly at the max they will do.

cheers

jamesd

james3333 wrote: »

as i look at the calculator, i see as it stands i will be getting 9k a year! no wonder no one bothers to pay into 'em any more.
bust a gut at 22 years old to pay into one until you retire then get 9k a year? pfffst. looks like i will be downsizing house.

That's £9k a year plus the state pensions, which add another £7k or so. And the first £10k free of tax, no NI, so you get about £14800 a year after tax. That's more than I normally spend including rent so you should be able to live quite well on that if you don't have a mortgage or rent to pay.

If you have a spouse they would also get their own pension including their own state pension.

Average income for pensioners is about £18k so you're doing pretty well so far.

One trick you can use to improve things is to put in more money, into pension or stocks and shares ISA, when there's lots of talk about how badly the stock markets are doing and how much they have dropped. That's how the press describes sales, when shares and related investments are cheaper than usual. And less when people are saying how the boom can never end and how wonderful it is that prices have been rising so much.

dunstonh

as i look at the calculator, i see as it stands i will be getting 9k a year! no wonder no one bothers to pay into 'em any more.
bust a gut at 22 years old to pay into one until you retire then get 9k a year? pfffst. looks like i will be downsizing house.

The calculator is putting it in todays terms. It will be higher but it is showing you want the spending power is today so you can put some context on it.

Did you put indexation on the calculator or level contributions?

However, you have to be realistic. From age 32, you have around 36 years until you retire. From there you will likely live around 30 years. So, if you paying in £120pm for 36 years, you shouldnt really expect that much more back for a similar period.

The pension will beat all alternatives. You just have to have more realistic expectations and understand the assumptions being made (in case you are using an assumption which is too low or too high or dont understand it at all)

atush

james3333 wrote: »

hi,
i have 20k in there , but im 32 years old, not 55
as i look at the calculator, i see as it stands i will be getting 9k a year! no wonder no one bothers to pay into 'em any more.
bust a gut at 22 years old to pay into one until you retire then get 9k a year? pfffst. looks like i will be downsizing house.

That is not how you look at it. 'Thats why no one bothers' isn't why they arent saving- as said you get back what you pay in plus tax releif and interest. If you wont get back enough, then you need to pay in more, or save into tax free savings out side a pension as well.

People don't pay in because they want to spend all the money they have on living well and having fun. The only way to retire well, is to always spend less than you have coming in.

Poor people used to not have things. Todays 'poor' have cell phones and xboxes. It is alll about what you spend your money on, and if you don't save it, you wont live well later.

Gatser

james3333 wrote: »

what would be a 'good' amount to have in my pension at age 55, if i dont have a mortgage to pay and just want to live 'comfortably'?

Have you seen THE NUMBER thread?
Before trying to calculate how much you should have in Pensions & Savings, I suggest you estimate how much you feel you need to "live comfortably" at 55.
From the responses I got this can be anything from £15k - £60k

What is your NUMBER?