The Double Pension Effect

mgdavid

Malthusian wrote: »

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Nikon's grouse is likely to be based on one of their friends saying outright that they have more income in retirement than in work (how else would Nikon know?) and I see no reason to disbelieve their friend.

Could also be they were talking about net disposable income, i.e. they'd arranged mortgage to be paid off when retired, no commuting costs or other work-related costs which can be high for some, no NI on pensions & savings income, etc etc.

michaels

I find their is a 'half pension' effect when looking to retire before the state pension age.

If I want to retire a year early I lose two years of income, the 50% of income I live off and the 50% that goes into a pension that will pay for one year of retirement.

And in reality there is another half a year resulting from lost fund growth from my pot having less long to grow before retirement.

This makes it really difficult to bring forward my retirement age