What's the minimum pension pot

JoeCrystal

Hmm, hard to say. Personally, if I want no longer to work, I would like to have my flat paid off with enough savings and pension to keep me comfortable until I die. Thankfully, I have no intention of having a wife nor children so I don't have to worry about that. But on the other hands, I do rely on workplace for social interactions so I might keep on working.

So technically, the minimum pension pot is whatever is sufficient to pay an income that is enough to cover all living costs plus one third on top. I would say it would be nice to get an income about £1200 net per month.

ATM, I am putting aside 25% of my salary into pension and 10% of my salary into S&S ISA and hope that it is enough. My ambitious plan is to retire at 60 so 30 years to go!

worried_jim

I would need £540,000. Currently save 18% into pension @ 42 years old with approx £120k pot presently. Doing okay. 11.5 years left on mortgage which will free up £500 pm to put to savings for ten years till retiring in early 60's. I know plenty that will be worse off, started pension saving at 20- best thing I ever did.

Johnny_Doe

atush wrote: »

Cant take pensions at 54.

What are you going to do in France for health care? Wont be covered post Brexit?

When I say I'm 44, I'm nearly 45 so was estimating roughly 10 years and you can see from my figures that no where mentions 54?

nellis10

worried_jim wrote: »

I would need £540,000. Currently save 18% into pension @ 42 years old with approx £120k pot presently. Doing okay. 11.5 years left on mortgage which will free up £500 pm to put to savings for ten years till retiring in early 60's. I know plenty that will be worse off, started pension saving at 20- best thing I ever did.

I'm very roughly in the same boat.
45, only paying 5% into pot but upping to 20% in new tax year.
Pot roughly £110K across 2 pensions.
Mortgage got 17yrs left which will free £500/month for savings.
Planning to retire early 60's too.

Additionally - Debt free in 2 months freeing up £550 immediately for investing. Opened VLS80 with Charles Stanley Direct S&S ISA. Only paying in £100 now, but will up to £500 once this comes free.

I now figure I'll NOT overpay mortgage and let it run it's course, remortgage when possible to lower rates and lower LTV, and shove everything I can into pension, savings and investments.

How very grown up of me

simonfitba

I'm targeting £24k a year and reckon I'll need £600k (back of fag packet calculation).

Was reading a breakdown of how much you'd need for £20k a year. Link here. Their state pension estimate seems too high though.

k6chris

Triumph13 wrote: »

a more interesting question might be how big a percentage increase in your retirement income would be worth working another year?

This is a great question. I'm just about to turn 53 and each year I delay deploying my defered DB pension adds about 3.6% pa to my gross annual pension income from this source. This figure of 3.6% is the neutral ERDF, which means although the monthly figure rises, the total pension income does not.
As I am still working, my current DB pension adds about 6% to this, although unlike my deferred DB pension, which I can take from 50 (TRA 63), my current one has an ERDF of 5% from 67, so assuming I took this early (55) this would add about another 2.5%. Finally I am also saving some AVC, which if I assume a drawdown rate of 4% adds about another 1% to this incremental figure. SO...each year I continue to work adds 3.6%+2.5%+1% = 7% (round numbers) to my annual pension, but less than this to my total pension income as with two of those pensions I am getting paid more often.

I can't work out if this means I should carry on working for 1 year, 5 years or deploy my pension now??! :rotfl: Thanks for a great question though!

atush

Johnny_Doe wrote: »

When I say I'm 44, I'm nearly 45 so was estimating roughly 10 years and you can see from my figures that no where mentions 54?

you said 44 (not nearly 45) plus 10 years = 54.

But that aside, you didnt answer the other relevant point? What are you going to do about health care as you wont be covered in France post brexit? And even now, they do have co pays.

Turquatic

I would say in our situation £200,000 will be more than enough in DC pensions / savings, we are 50/51 and plan to retire in 11/12 years . A forces pension kicks in at 60 of approx £7,000 a year, index linked, so that is worth what, £170k minimum if it was self funded?
We will want about £18k a year from say 63-67, so £11k from savings and drawdown - say a £6k / £5k split. At 65 a very small lgps pension kicks in , probably @£1500 a year.
Both will get full State pension at 67, my forecast is £162 weekly, OH's £155. (Need 4 more years NI). This is all in "today's " money.
So at 67 - £16500 SP, £7000+ forces pension , £1500 lgps and say £4k drawdown, with a cash buffer of 5 years worth in case of market crashes..
£29k will enable a very comfortable life with lots of travelling.
None of this includes inheriting a half share of a house, which in today's terms is @£75k - Dad is 76 but could live to 100, in which case our Daughter will benefit more than us, or it could all be swallowed in care fees, who knows.

Martinslovechild

Didn't I read somewhere that the average pension pot (i.e. full pension pot - not the annual amount withdrawn) is something like £40,000 ??

I've certainly pushed myself over the past 20+ years to deposit as much into my own pot as possible, but I've also seen an erosion in company benefits, particularly during the past decade or so. I know of quite a few people who are depositing something ludicrous like 2% into their pension pot. My own calculation was always half my age, so at the point when I was 30, I'd deposit 15% per annum, and when I hit 40 I'd deposit 20% and so on.

ajbell

That might be the average pot size but people could have multiple pension pots.
I don't know what the average is per person?.