Apparently pensions aren't worth it?

Triumph13

Whichever route you take (and I agree with almost everyone else that you should be concentrating on pensions), the important thing is to realise that you are way behind the game and you need to face up to that, cutting back on your spending as much as necessary now and investing that wisely to have any hope of a comfortable retirement. Another rule of thumb that is often quoted is that the percentage of your income that should go into your pension is half your age at the time you start contributing - so 19% in your case. If you'd started saving for retirement earlier you could have got away with a lower percentage, but what's done is done and you need to face up to that and knuckle down.
We have no idea what your current income is, nor your expectations for retirement, but you mentioned a retirement income of £20k pa pre tax in one post. Let's say you want to achieve that figure from the age of 68. A full state pension gives you £8,500 of it so you need to achieve a further £11,500 from your investments. Reasonable planning assumptions might be 4% pa real investment growth and then a 3.5% drawdown in retirement. On those assumptions you would need to save £5,750 pa (increasing with inflation) into your pension for the next 30 years. If you want £30k pa you would need to increase that contribution to £15k pa.

dunstonh

fred246 wrote: »

Say you are in your twenties and you want to invest £100 a month in a pension how would it actually work with an IFA. The first thought of an IFA is "where's my money coming from?" They aren't really interested in people with little money. Would they charge you upfront say £2K for starting it and then take a percentage? When I started a pension in the 90s the IFA took all my first years contributions. Didn't tell me of course. It was in the small print. An easy way of starting is to choose a Vanguard Lifestrategy fund and choose a platform and you're away. I love it when someone talks about a Lifestrategy fund on here because the IFAs hate them. It's the start of investing for yourself without them getting any payments.

You cant compare 90s to today.

We would charge £500 for a small pension and on a one-off basis. The fee would be collected via the pension to ensure tax relief on the fee. We would use an option that is cheaper than VLS

And the IFAs on here do not hate VLS. We used to use VLS a lot until better options came along. The difference is that IFAs dont sing for the church of Vanguard. They are not biased in the way many Vanguard investors are.