Pension contribution help please!

mark5

Thrugelmir wrote: »

A larger pot may allow people the opportunity to retire earlier. Also gives a degree of protection against uncertain markets.

In this case though with a pot of £8000 at age 42 and annual income of £16,000 can you see early retirement happening?

Thrugelmir

mark5 wrote: »

In this case though with a pot of £8000 at age 42 and annual income of £16,000 can you see early retirement happening?

In my reply has to be kept in context. As was primarily in response to your comment of "so you don't need to build a huge pension pot to maintain your standard of living". Early retirement could be as little as a few months.

atush

I dont think there is a need to confuse the Op with fighting about how much to save.

The point is, if they ever want to retire, they need to save more as they are behind with only 8K in pension at that age.

marathonic

I like the idea of drip feeding. Increase your pension contributions by £250 per month and the result will be that your salary drops by £200 per month. Then set up montly transfer of £200 from your ISA to your current account to replace your lost salary.

When your ISA drops to about £2000, after about 15 months, decrease the pension contributions back to their current level, leave the £2000 as a base emergency fund which you can start adding to again and take comfort in the fact that your pension, depending on market performance, is likely to be over 50% higher than its current level.

You say that, in addition to the one-off contribution, you can afford to increase the monthly contribution a bit - in this case, I'd follow the above plan, contributing the extra to your ISA and you'll be able to stick to the above plan longer than 15 months before the ISA dropped to the minimum £2000 I'd like to see as a basic emergency fund.

xylophone

http://www.thepensionsregulator.gov.uk/employers/what-is-my-staging-date.aspx

https://www.gov.uk/workplace-pensions/what-you-your-employer-and-the-government-pay

What arrangements is your employer making- have you checked?

Re state pension https://www.gov.uk/new-state-pension/overview

If you pay more into your pension on a regular basis, will you become eligible for any income related benefits?