pension

degboe

ive been paying into a ReAssure for about 5 years now £50.00 a month as that is all I can afford , ive just had a letter today saying if I retire at 60, I would get £123 a year! and says my current value is £4186.34 , am I being ripped off? should I find another pension. can anyone help please.

jaydeeuk1

Ripped off how? You've put in £3000, now worth over £4000 5 years later, I'd say that isn't too bad at all in current climate.

How old are you?

sandsy

The biggest factor in what you get out is what you put in.

At 60, the money has to last you for many years so prioritising money now or money later is a key decision.

AnotherJoe

Well you are just about getting back what you've paid in (including tax relief) so no growth, on the face if it pretty poor, what choices do you have about what its invested in and how old are you?

greenglide

You have to read the projections of potential mothly pension, if you bought an annuity, with a high degree of schemicism.

£50 a month is only £600 per year. To provide you with £50 per month of pension, at age 60, over a life expectancy of 90 years (makes the sums easy) is 30 years of retirement which would cost, say, £18,000.

It is all about how much you pay and for how long but, unfortunately, £50 will never pay for huge amounts of pension.

xylophone

How old are you?

Are you employed? If so, your employer should be offering a pension, within a year or so if not now.

Have you obtained a state pension statement?

dunstonh

Pay in peanuts, get back peanuts.

should I find another pension.

And you would still get back peanuts.

ive just had a letter today saying if I retire at 60, I would get £123 a year!

60 indicates early retirement but this would suggest that early retirement is not on the cards for you. So, pricing an annuity at age 60 is going to be low as your life expectancy is going to be around 27-30 years. Plus, that figure is after inflation (in todays terms, not actual terms). It could well be after lump sum and include spouse provision with indexation.

am I being ripped off?

No. You are just not understanding the assumptions used in the example projections and paying in peanuts and trying to retire early on it.

degboe

hi all I'm only 50, I know I will never get chance to retire at 60, most likely I will have to go on to 70 lol
now ive been told bluntly you get what you pay in, which is true , but my wages from 3 jobs wont allow me to pay any more in, without leaving me short more than I am. But many thanks for all your comments.

xylophone

Have you seen post 6?

LHW99

Also post 4 - any pension is just a wrapper. Some investments may give you a better chance of growth. Since it doesn't look as if you can retire until SPA, that at least 16 years, maybe a bit longer by the time you get there.

Maybe you should be in a fund with higher equity (say 60-80%?) - do you know what the pension money you have is invested in?