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Drawdown: safe withdrawal rates
edited 14 April 2021 at 8:35PM in Pensions, annuities & retirement planning
228 replies 90.1K views
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I guess MSE Towers don't agree.
Thank you for taking the trouble to collate all this.
People still made sizable employee contributions to the schemes. One scheme I was a member ( mid 90's) had employee contribution levels of 9%. They weren't simply funded by employer contributions. How many people now save 9% of their salary into personal pension plans? The emphasis has changed for people. Party now and worry pension provision later. Bigger and more expensive housing. Better cars. Long distance travel. All down to personal choice.
That level of contribution would have been unusual then, not so much now.
We can look at the approximate cost of a db scheme being a round 25% of salary which still means the company is contributing far more than most would do to a DC scheme.
Many peoples approach has not varied that much and certainly not in the also two or three decades. It's the fact that db schemes have been closed everywhere apart from the public sector, and significantly diluted even in the latter.
Non-essential interesting material
Thoughts on my plan please retiring 59, £9500 defined benefit pension, 8k assumed state pension, £275000 investments, desired income £2000 a month, £2250 looks possible.
I've also added a worked example of how to use the 4% rule to calculate approximate monthly pension contributions needed to get to a given target income at and before state pension age.