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The Most Important Document You Will Never Read....
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They both pay into the pension plan.
So the conclusion seems to be that even though our guy earns more than average and doesn't seem to have a family to keep, he still can't put enough aside to finance his own retirement without a State subsidy.
That is a valid point, as you move down the pay scale there must be a marginal point at which it just isn't worth it, with the impact on life in the here and now."If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....
"big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham0 -
grizzly1911 wrote: »I
Grahams arithmetic gave you £90 of that;)
The original point said "save" not pay into a pension which is the way you have generated the other £70.
Either way £65/£85 a week for all the other stuff in life isn't a great deal when the expenses used are light anyway.
Two other items for the pot:-
- Student loan repayments
- Any employer contribution to the pension
- Saving for a deposit,,,
And yet I keep saying to you that Graham, not me, supplied the example.
Jeeze you bears really do find it impossible to criticize each other!! :rotfl::rotfl::rotfl:0 -
RenovationMan wrote: »And yet I keep saying to you that Graham, not me, supplied the example.
Jeeze you bears really do find it impossible to criticize each other!! :rotfl::rotfl::rotfl:
Appreciate it is Grahams example. You demonstrated that if you want to live as a monk or nun you can have a lovely retirement (possibly).
Just out of interest - as you know about payroll, are student before tax similar to pension contributions or after tax?"If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....
"big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham0 -
grizzly1911 wrote: »That is a valid point, as you move down the pay scale there must be a marginal point at which it just isn't worth it, with the impact on life in the here and now.
Let's look at that 'rule of thumb' again:
Take the age you start your pension and halve it.
Put this percentage of your salary aside each year until you retire.
So if someone is 18 and on £8k per year, he has to put away 9% of his gross salary. This equates to £640 per annum, £53.33 per month or £12 per week.
If he didn't get another pay rise and didn't get any return on his investment and he retired at state pension age of 67 (49 years after starting his pension), he would have a pension pot of 31,358.04.
3% interest would give him: £71,275.84
6% interest would give him: £189,617.83
The average UK pension pot is £25k0 -
grizzly1911 wrote: »Appreciate it is Grahams example. You demonstrated that if you want to live as a monk or nun you can have a lovely retirement (possibly).
I didn't demostrate that the person had to live like a monk.
"With no pension contribution you will have £651 left at the end of the month.
With £4k pension contribution you will have £384 left at the end of the month.
The difference between the two is that for £333 a month pension contributiuon you are losing £267 out of your disposible income."
I demonstrated that the guy could pay £333 per month into a pension plan with an outlay of only £267 from his net pay.
GRAHAM'S test case would have £384 'spends' at the end of the month, instead of '£651', which I think is reasonable considering he could end up with a pension pot of between £300k and £600k when he retired.
Quite where all your 'monk' stuff comes from I don't know because GRAHAM came up with the test employee and so therefore GRAHAM didn't put an element of 'socialising' into the outgoings section. LOL, you guys really really can't criticize fellow 'bears' can you? You'll try anything to pin his example onto me :rotfl:0 -
And he would need...?RenovationMan wrote: »L
If he didn't get another pay rise and didn't get any return on his investment and he retired at state pension age of 67 (49 years after starting his pension), he would have a pension pot of 31,358.04.
3% interest would give him: £71,275.84
6% interest would give him: £189,617.83
The claim made, I think, was that the average joe can't afford his own retirement, in a hypothetical world with no state pension (not just that he can't put a bit by to add to the state pension)."It will take, five, 10, 15 years to get back to where we need to be. But it's no longer the individual banks that are in the wrong, it's the banking industry as a whole." - Steven Cooper, head of personal and business banking at Barclays, talking to Martin Lewis0 -
And he would need...?
The claim made, I think, was that the average joe can't afford his own retirement, in a hypothetical world with no state pension (not just that he can't put a bit by to add to the state pension).
Well the rule of thumb for what you need in retirement is 2/3rd of your working wage (i.e. because you no longer have a mortgage, commuting costs, etc.)
2/3rd of this chaps £8k is £5333. To get that sort of an annual pension, the bloke would have to have a pension pot of about £100k. This would be achievable with his £53.33 pension savings if he got a return of 4.1% on his pension investment.0 -
The whole thing is a ponzi/pyramid scheme. They've long since spent everything that was put in by workers over the last few decades and need more and more 'suckers' to enter the 'scheme' to pay new money in, just to pay the benefits of those nearer the top of the pyramid. Like all such schemes this one will collapse. especially as the UK ages. Anyone paying in now are just funding those already retired.0
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RenovationMan wrote: »Over egging it is when you lose £170 in tax, add £152 to the annual pension contribution and then subtract this from net income instead of gross.
And then have the gaul to moan at someone else for not producing realistic figures. :eek:
The original discussion was revolving around SAVING for your own pension. ISA's and the like. Hence that is what's being worked on. You'll note wotsthat uses the term saving, rather than pension payments.
You are producing figures base on pension payments. A different scenario.0 -
Graham_Devon wrote: »The original discussion was revolving around SAVING for your own pension. ISA's and the like. Hence that is what's being worked on. You'll note wotsthat uses the term saving, rather than pension payments.
You are producing figures base on pension payments. A different scenario.
Fine, but then you still added up the outgoings wrong and put extra in your 'savings' in order to massage your figures.
Apart from the tax free portion of pensions, the scenarios are the same.0
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