Pension Contributions - how much?

Scrooge1

I have a question regarding pension contributions. I gather the accepted approach is now to half the age you start your pension and then adopt that as a percentage of your salary which you should contribute. What I would like to know is does this percentage take into account the tax relief I will receive on my contributions or is this excluded from the calculation? By the same token, presumably the percentage is calculated on gross, rather than net salary.

Many thanks.

dunstonh

I gather the accepted approach is now to half the age you start your pension and then adopt that as a percentage of your salary which you should contribute.

Its a crude calculation that is often used as a quick and dirty rule but obviously doesnt take into account how much you want at the other end.

What I would like to know is does this percentage take into account the tax relief I will receive on my contributions or is this excluded from the calculation?

Doesnt really matter. It's not an accurate rule and the margin of error could easily be more or less than the tax relief.

Your best bet it to decide what income you want in retirement in todays terms and then see how much that is going to cost you to get that.