Worried about starting pension later in life

ForestBluebells

Thank you everyone. I couldn’t sleep last night with worry and was in tears thinking I’ve left it too late, worrying what will I ever do. It feels a little more manageable now and once I’ve had a discussion with my employer about pay rise/pension contributions I will know a bit more about where I stand. From my understanding of the research I have done a pension always wins due to the tax benefit although I guess a LISA is the same once you have hit the max matched pension contributions from your employer as you get a 25% bonus on the LISA so I think it works out the same. This month I’m working out all the areas I can cut back on my spending and I’ll try save as much as I can. I’m going to look into stocks and shares ISAS (I have done some research on the vanguard VWRL fund which looks to fit the bill and I’ll keep paying into my regular saver too so I can build up my emergency fund. Then hopefully I can start attacking pension savings. I was really scared the rest of my life needed to be lived painfully frugally in order to afford retirement, I don’t have huge needs but a life of beans on toast kinda scared me 😂 I will cut back my spending massively though and be more strict about sticking to a budget. I’m still worried... but feeling a lot more hopeful that I’m not doomed to an eternity of struggling.

LHW99

ForestBluebells wrote: »

Thank you everyone. I couldn’t sleep last night with worry and was in tears thinking I’ve left it too late, worrying what will I ever do. It feels a little more manageable now and once I’ve had a discussion with my employer about pay rise/pension contributions I will know a bit more about where I stand. From my understanding of the research I have done a pension always wins due to the tax benefit although I guess a LISA is the same once you have hit the max matched pension contributions from your employer as you get a 25% bonus on the LISA so I think it works out the same. This month I’m working out all the areas I can cut back on my spending and I’ll try save as much as I can. I’m going to look into stocks and shares ISAS (I have done some research on the vanguard VWRL fund which looks to fit the bill and I’ll keep paying into my regular saver too so I can build up my emergency fund. Then hopefully I can start attacking pension savings. I was really scared the rest of my life needed to be lived painfully frugally in order to afford retirement, I don’t have huge needs but a life of beans on toast kinda scared me 😂 I will cut back my spending massively though and be more strict about sticking to a budget. I’m still worried... but feeling a lot more hopeful that I’m not doomed to an eternity of struggling.

But do make sure you put a little "treats money" into your plan - you don't want to stop enjoying life now - and those little rewards give a point to all the savings

Durban

ForestBluebells wrote: »

Thank you everyone. I couldn’t sleep last night with worry and was in tears thinking I’ve left it too late, worrying what will I ever do. It feels a little more manageable now and once I’ve had a discussion with my employer about pay rise/pension contributions I will know a bit more about where I stand. From my understanding of the research I have done a pension always wins due to the tax benefit although I guess a LISA is the same once you have hit the max matched pension contributions from your employer as you get a 25% bonus on the LISA so I think it works out the same. This month I’m working out all the areas I can cut back on my spending and I’ll try save as much as I can. I’m going to look into stocks and shares ISAS (I have done some research on the vanguard VWRL fund which looks to fit the bill and I’ll keep paying into my regular saver too so I can build up my emergency fund. Then hopefully I can start attacking pension savings. I was really scared the rest of my life needed to be lived painfully frugally in order to afford retirement, I don’t have huge needs but a life of beans on toast kinda scared me 😂 I will cut back my spending massively though and be more strict about sticking to a budget. I’m still worried... but feeling a lot more hopeful that I’m not doomed to an eternity of struggling.

Please don’t worry too much. You still have years. I lived abroad for many years and returned in my 30’s. I only started paying into a pension at 34. Luckily it is a DB one and also lost valuable NI years.

My husband also only started paying into a pension at 36. This being a DC one

We came back to this country with literally nothing 21 years ago and 3 children in our 30”s. We are now in our 50’s and because of realising what we needed to and making wise choices , we should have a decent , comfortable retirement. We won’t be able to retire early but it will be comfortable. And we have had a good life without denying ourselves or our children.

So please don’t worry. It is completely salvageable

klew356

If it makes you feel any better I’m in the exactly same position but 36! And I earn a lot less than you

I’m going to ask my employer to up my percentage this month (currently I put in the minimum 5% they contribute 3%) until I decide whether or not I want to open another pension or LISA. I know it is not a salary sacrifice pension and I know they wouldn’t change it or contribute more you see. My question is I used a 25% bonus on a HTB isa last year does that mean I cant use it with a LISA? I think it does. Should, fingers crossed, get a payrise in April and will use this percentage again into a pension. Id also really to start over paying my mortgage, I have 21 years left and would like it over by the time I am 50, currently it would be 58.

Zorillo

You would still receive 25% on your annual LISA contributions, but you can't "use" it for anything until you're 60 at which point you can literally use it for anything.

katkatmachine

Same as my partner! She only started saving into her pension scheme when she was 36. I checked pension calculators online and based from that if she continues contributing same amount until she's 67 she'll only get around £5k a year! I don't know if they're accurate but the figures are very disappointing! Luckily her state pension will start by then so that's around £8k so total of around £13K annually. We're planning to move back to Asia by then and I believe her £13k plus all of our savings will be more than enough for us to live comfortably until we die.

Living here in the UK is so expensive. With our future pensions and mortgage it will be hard to get the lifestyle we want after our retirement. So moving back to our home country would be the best option for us.

I hope all goes well for you too.

[Deleted User]

I think the rule of thumb is at least half your age in % terms of your salary when you start and keep that going.

atush

hat if she continues contributing same amount until she's 67

Probably not very accurate as is based on annuity rates

klew356

Zorillo wrote: »

You would still receive 25% on your annual LISA contributions, but you can't "use" it for anything until you're 60 at which point you can literally use it for anything.

Looks like I need to look into this a bit more then!