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[Deleted User]

Albermarle said:

[DELETED USER] said:

Is the poor economy likely to have any effect? They are saying 4% loss due to brexit and we will have the pandemic on top, doubtless higher taxes. How does a poor economy effect saving for a pension, or doesn't it?

Saving for a pension is a long term project , so current situation is not that relevant . One thing is absolutely certain though, if you do not increase your contributions then you will have a poor pension.
As you are a higher rate taxpayer , the tax relief with a pension is very generous . So generous that one day it will get stopped .
If 20% before tax is too high for you , then how about 20% after tax . With the tax relief this will effectively only cost you 12 % pre tax .
One caveat is that you need to pay enough higher rate tax to claim it back. Earning say £51K , means you can only claim tax relief on £1K

That's interesting. I presume I don't need to do anything to "claim tax relief", it's just automatic if I put more into the company pension?

Speaking of which is the company pension scheme a good idea or should I be shopping around? And if I use some other scheme do I need to somehow inform HMRC to get the relief?

Marcon

[DELETED USER] said:

How would I go about assessing how much I need to live on?

It seems that pension products like annuities are getting worse over time. Property just keeps getting more expensive. Some pension calculators suggest I'd want an income for £30k/year but will that be any good with inflation by 2048?

I am in the top tax bracket earnings wise. Wife doesn't work. Trying to buy a house but it's not easy, so might be renting into retirement. At the moment everything has to go into saving for a deposit if I want to own property, and the mortgage will be quite expensive.

IvanOpinion, thanks, 20% has been suggested by others. 20% of before-tax income, which would be like paying a second mortgage. Retiring early would be nice but seems like an unattainable dream.

If you're in the top tax bracket, get some proper advice - the sort you pay for, based on a full understanding of your circumstances. Expecting people to foresee the future and guess what you personally might need, based on close to zero information, isn't going to help you. 

The famous 'rule of thumb' to calculate the amount you need to save for a pension was a reasonable guideline 20 years ago, but has very little applicability these days given the step-change in investment returns and annuities - and the advent of more flexible pension products such as drawdown. 

Albermarle

That's interesting. I presume I don't need to do anything to "claim tax relief", it's just automatic if I put more into the company pension?

Not necessarily it depends on how your contributions are taken from your salary. 

Salary sacrifice https://thepeoplespension.co.uk/salary-sacrifice/

Net Pay ( a  confusing name as it actually means the money comes out pre tax )

Relief at source - contributions are taken out after tax 

For the first two you get all the tax relief without doing anything. For the third one you will get basic rate relief and you have to claim the higher rate relief.

Speaking of which is the company pension scheme a good idea or should I be shopping around?

As there so many different schemes it is impossible to say . I would say prioritise increasing contributions and then think about the actual scheme later once it is somewhat bigger . In any case most workplace pensions are OK 

penners324

Are you not in your employer's pension scheme? Request they up your contributions a bit.

If you're in the top tax bracket what are your outgoings?!!

penners324

You employer will contribute into your pension scheme that they operate they won't contribute into a personal pension scheme.

Every pension scheme has to be registered with the pensions regulator so they can automatically apply the tax element 

[Deleted User]

penners324 said:

If you're in the top tax bracket what are your outgoings?!!

It's all going into a deposit on a house at the moment.

poochops

Is your wife able to work? even if it was part time then you could save for the deposit and build a pension, plus she'd be accruing NI years and building her own pension pot too. 

[Deleted User]

poochops said:

Is your wife able to work? even if it was part time then you could save for the deposit and build a pension, plus she'd be accruing NI years and building her own pension pot too. 

Not at the moment, maybe in a year or two.

I should probably have mentioned that whatever pot I save needs to be enough for her as well.

Mutton_Geoff

[DELETED USER] said:

How would I go about assessing how much I need to live on?

https://www.which.co.uk/money/pensions-and-retirement/starting-to-plan-your-retirement/how-much-will-you-need-to-retire-atu0z9k0lw3p

A very general amount used is £2k for a single person, £3k for a couple as a base figure. If you are a high rate tax payer, now is the time to take full advantage of the benefits available at the moment.

nyc_451

Mutton_Geoff said:

[DELETED USER] said:

How would I go about assessing how much I need to live on?

https://www.which.co.uk/money/pensions-and-retirement/starting-to-plan-your-retirement/how-much-will-you-need-to-retire-atu0z9k0lw3p

A very general amount used is £2k for a single person, £3k for a couple as a base figure. If you are a high rate tax payer, now is the time to take full advantage of the benefits available at the moment.

Really? I don't even get 2k after tax whilst working... Sometimes it's really depressing to read articles about pension planning.