Legal & General Retirement Estimate

Bitzal

Hello,

I've just got my annual pension report from Legal & General that I get through my current employer.

I put in 4% and my employer puts in 8%

My estimated fund value at retirement is £157k - that seems pretty low considering I'm only 26 and have approx 41 years left..

I know as I progress and earn more that will go up but even then it doesn't seem a lot.

I don't know a lot about pensions so I suppose my questions are:
Is there an ideal target to aim towards to be comfortable?
Am I on a good pension?
Is there anything else I should do now to ensure that when the time comes I have enough?

Any tips or advice is always appreciated!

Thanks!

Annie1960

How are your funds invested?

At your age, you should probably have most in equities rather than cash/bonds. The way it is invested will make a big difference to the risk you are taking, and hence will affect the return.

dunstonh

My estimated fund value at retirement is £157k - that seems pretty low considering I'm only 26 and have approx 41 years left..

It is not an estimate. It is an example using a range of assumptions that are statistically unlikely to be correct.

Is there an ideal target to aim towards to be comfortable?

yes

Am I on a good pension?

Dont know. you havent told us anything about it. However, the 8% employer contribution is good.

s there anything else I should do now to ensure that when the time comes I have enough?

Understand the assumptions used in the example projections to see if they reflect your circumstances. They could be understating the likely outcome or even potentially over stating it (although current projections are geared to understate more than overstate).

bigadaj

Bitzal wrote: »

Hello,

I've just got my annual pension report from Legal & General that I get through my current employer.

I put in 4% and my employer puts in 8%

My estimated fund value at retirement is £157k - that seems pretty low considering I'm only 26 and have approx 41 years left..

I know as I progress and earn more that will go up but even then it doesn't seem a lot.

I don't know a lot about pensions so I suppose my questions are:
Is there an ideal target to aim towards to be comfortable?
Am I on a good pension?
Is there anything else I should do now to ensure that when the time comes I have enough?

Any tips or advice is always appreciated!

Thanks!

If you go onto most of the pension company websites they have calculators which give projections, so you can vary the returns, your earnings increasing and time to see what you might get at the end if the day. You end to be careful about inflation and how you allow for it, but it will give an indication, and if you accept the risk you want to be heavily invested in shares rather than bonds as that will probably give you the largest growth over the longer term.

RickyC_IFSWP

Bitzal wrote: »

Hello,

I've just got my annual pension report from Legal & General that I get through my current employer.

I put in 4% and my employer puts in 8%

My estimated fund value at retirement is £157k - that seems pretty low considering I'm only 26 and have approx 41 years left..

I know as I progress and earn more that will go up but even then it doesn't seem a lot.

I don't know a lot about pensions so I suppose my questions are:
Is there an ideal target to aim towards to be comfortable?
Am I on a good pension?
Is there anything else I should do now to ensure that when the time comes I have enough?

Any tips or advice is always appreciated!

Thanks!

Well, I salute you for starting to take an interest in pensions at the age of 26.

Firstly, as has been mentioned there are various assumptions made for these projections and they are unlikely to take into account of your income (and therefore your contributions) increasing. The new statements are likely to be "inflation" adjusted too, meaning that the figures should be in today's money, and have lower than previous projection rates.

Your question about the ideal pension is a tough one because everyone is different. What's more is that what likely income your pension will give you will depend on so many factors and your choice of at-retirement products. Basically, it's all very vague because we can't predict what will happen in future.

Whatever happens, your end goal should be to generally grow your pension as large as possible by contributing as much as you can and investing wisely in well diversified investments. A total of 12% contributions per month into your pension is actually very good. I would consider saving into ISAs and/or other personal pensions with any surplus money you can afford to put away on top of this. This will ensure that you're living now, but also looking after yourself for the future. After all, life is full of trade-offs.