How much is my final salary pension worth?

coastline

If the house is in order with little or no mortgage I'd be going at 50 yo with £21 grand. All up to the individual of course but you're a lot fitter at 50 yo than in your 60's. Plenty of hobbies to do which don't cost a lot of cash. Relax and enjoy it.
Always makes me wonder how you can't get along with £600-800 grand pension pot and the state pension to come. Do people really think that the majority of pensioners are that well off ? You've only got to go to the local park and see the happy smiling faces of retired people on the bowling green.
Regarding CETV's there's plenty in the 15-20 times bracket. Local authorities for one. DB pensions are not always gold plated but are very steady. You also need the service in which is why many pay out sums of £5 grand a year. If they didn't have that then they'd probably get a state top up. All swings and roundabouts.
Need to stop getting too worried about boat loads of money and try to live. Virus is bad enough.

rothers

coastline said:

If the house is in order with little or no mortgage I'd be going at 50 yo with £21 grand. All up to the individual of course but you're a lot fitter at 50 yo than in your 60's. Plenty of hobbies to do which don't cost a lot of cash. Relax and enjoy it.
Always makes me wonder how you can't get along with £600-800 grand pension pot and the state pension to come. Do people really think that the majority of pensioners are that well off ? You've only got to go to the local park and see the happy smiling faces of retired people on the bowling green.
Regarding CETV's there's plenty in the 15-20 times bracket. Local authorities for one. DB pensions are not always gold plated but are very steady. You also need the service in which is why many pay out sums of £5 grand a year. If they didn't have that then they'd probably get a state top up. All swings and roundabouts.
Need to stop getting too worried about boat loads of money and try to live. Virus is bad enough.

I am very tempted, the only thing that may stop me is that my mortgage doesn’t get paid off until 2024 and I work from home which isn’t exactly taxing. The mortgage is reality isn’t much of an issue as I am on a lifetime tracker at 0.17% above the base rate. I had cancer in 2015 which gave me an 18% chance of being alive in July 2020 too, that is my second primary cancer and I am currently fit and well with no evidence of disease. It’s definitely time to enjoy life although my wife is still working and her pension is relatively small.

Ray_Singh-Blue

I don't understand how a pension of £28k per year from age 55 can be worth £1.7 million.
That's enough to pay for something like 70 years and very few of us are going to live to be 125.
Is it the index linking? If so, why? Doesn't money invested generally match or better RPI?

garmeg

Ray_Singh-Blue said:

I don't understand how a pension of £28k per year from age 55 can be worth £1.7 million.
That's enough to pay for something like 70 years and very few of us are going to live to be 125.
Is it the index linking? If so, why? Doesn't money invested generally match or better RPI?

It is the index linking. Yields on index linked gilts are negative so the cost of an index linked annuity is correspondingly high.

Thrugelmir

Ray_Singh-Blue said:

I don't understand how a pension of £28k per year from age 55 can be worth £1.7 million.
That's enough to pay for something like 70 years and very few of us are going to live to be 125.
Is it the index linking? If so, why? Doesn't money invested generally match or better RPI?

Compounding.  The insurance company is underwriting the inflation risk for the remainder of your life. 

snowqueen555

rothers said:

coastline said:

If the house is in order with little or no mortgage I'd be going at 50 yo with £21 grand. All up to the individual of course but you're a lot fitter at 50 yo than in your 60's. Plenty of hobbies to do which don't cost a lot of cash. Relax and enjoy it.
Always makes me wonder how you can't get along with £600-800 grand pension pot and the state pension to come. Do people really think that the majority of pensioners are that well off ? You've only got to go to the local park and see the happy smiling faces of retired people on the bowling green.
Regarding CETV's there's plenty in the 15-20 times bracket. Local authorities for one. DB pensions are not always gold plated but are very steady. You also need the service in which is why many pay out sums of £5 grand a year. If they didn't have that then they'd probably get a state top up. All swings and roundabouts.
Need to stop getting too worried about boat loads of money and try to live. Virus is bad enough.

I am very tempted, the only thing that may stop me is that my mortgage doesn’t get paid off until 2024 and I work from home which isn’t exactly taxing. The mortgage is reality isn’t much of an issue as I am on a lifetime tracker at 0.17% above the base rate. I had cancer in 2015 which gave me an 18% chance of being alive in July 2020 too, that is my second primary cancer and I am currently fit and well with no evidence of disease. It’s definitely time to enjoy life although my wife is still working and her pension is relatively small.

Considering your comment above I'd second another previous post and retire at 50. Your choice of course, you're in a great position.

Albermarle

Ray_Singh-Blue said:

I don't understand how a pension of £28k per year from age 55 can be worth £1.7 million.
That's enough to pay for something like 70 years and very few of us are going to live to be 125.
Is it the index linking? If so, why? Doesn't money invested generally match or better RPI?

I think the index linking pretty much doubles the value ( maybe not quite ) 
You are right that a well invested portfolio should produce a return above inflation . However this is not 100% guaranteed and the trustees of the DB pension have to play it safe with their investments , which reduces the return .