Am I doing the most efficient saving??

Eco_Miser

Half your age when you start paying in. Of course, if you started age ten, then you're on course.

brendon

masamoah wrote: »

wow. you mentioned that i should be putting 13.5% of my salary into a pension?? I am only doing 5%. How did you come to the figure of 13.5%?

5% will not get you far. I suggest you check out the Money Advice Service's pension/retirement calculator for a rough idea of what your pension would be worth. Hopefully that shocks you into upping your contribution.

Contributions from employers do count, as well -- are you getting a match?

chelseablue

Id not heard of the pension calculation either so I looked up what is going into mine.


I pay 6% of my salary in
My employer pays 8.5% in


I am 32

masamoah

brendon wrote: »

5% will not get you far. I suggest you check out the Money Advice Service's pension/retirement calculator for a rough idea of what your pension would be worth. Hopefully that shocks you into upping your contribution.

Contributions from employers do count, as well -- are you getting a match?

Yes, it is getting matched. So i am putting in 5% and employer paying 5%, so i will add a percentage or two on to make up the required amount of 13.5%.

Cheers

eskbanker

masamoah wrote: »

Yes, it is getting matched. So i am putting in 5% and employer paying 5%, so i will add a percentage or two on to make up the required amount of 13.5%.

It's only a rough rule of thumb rather than a requirement as such - individual circumstances will vary so it's not as if it's an exact figure to aim for. Many would be delighted at work-based pension contributions totalling 10%, whereas some would get/make substantially more....

vsyrine

Hi Syrine here just want to share my story. I am a Pinay working as junior collection officers in credit card for 6 years. I started earning just 9k a month way back 2010 not deducted the tax and any deductions a regular employee has.
But even though I have small salary I manage my expenses well, I make sure not so spent beyond my means.
I also have this thinking of paying myself 1st before I spent my money for my other expenses. Paying myself 1st meaning saving a portion of my salary every month for my future.
So in my 6 years of working and being an employee I manage to save my money, and started to invest for my future.
I look for some investment, I get my life and investment insurance, I also manage to invest in the stock market.
Because in my back of my head, I know I need to do something, being an employee and having a stable job doesn't mean having a security for a long run.
You may feel secure today because you get your monthly pay check, but how about if you already retired.
Are you ready for it?
In life I always believe that we have our own choice.
So if you want to get ahead, you must get started.
It's not bad to plan and think of the future, what is not right is that you spend all you have today and say come what may tomorrow.
Like so many others I am just a regular employee, but I have not been seeing myself to be a slave forever.
I want to have changes in my life so in order for me to achieve that I need to make an action.
Because dreams without action is nothing.

Dan83

Get a Barclays blue account and a co-op accounts (can't remember the account name) meet the T&Cs and make £96 per year.

darkidoe

Eco_Miser wrote: »

Half your age when you start paying in. Of course, if you started age ten, then you're on course.

Is this till you are retired?? What's the goal this achieves then? Mine is about 9.5% at the moment.

bigadaj

darkidoe wrote: »

Is this till you are retired?? What's the goal this achieves then? Mine is about 9.5% at the moment.

Yup.

It's a very rough indication of the potential sums that you need to put by. It's primarily used to show the effect of compounding as most pensions will contain a large proportion of equities and the capital and dividend returns will be able to compound in a tax free environment.

So if you are 25 then total pension contributions, including employer and tax relief, might be 12.5%, as opposed to 20% at age 40.

The ability to make such contributions will vary between individuals but it's just a concept rather than a strict rule.