Anyone else feel down about how long it takes to see meaningful difference to savings?

ForestBluebells

I only started saving and investing for my future/retirement January 2020, I’ve saved more than I could have originally thought possible with a strict budget and earning as much extra income to invest as I could but being so early in my journey my total pensions/investments still feels so low on my journey. 

How does everyone else keep motivated? I know it’s a long journey anyway but kind of lost my enthusiasm. 

QrizB

ForestBluebells said:

I only started saving and investing for my future/retirement January 2020, I’ve saved more than I could have originally thought possible with a strict budget and earning as much extra income to invest as I could but being so early in my journey my total pensions/investments still feels so low on my journey. 

How does everyone else keep motivated? I know it’s a long journey anyway but kind of lost my enthusiasm. 

Just remind yourself it's a marathon, not a sprint.

This is your thread?

https://forums.moneysavingexpert.com/discussion/6128270/head-out-of-the-sand-saving-for-a-shiny-future

Sounds like you're doing well. Based on the first post, every month you're saving roughly 2 weeks expenditure. Keep that up until you're 60 and you'll have 12-13 years' worth of spending squirelled away, before considering any growth.

One thing I don't see quantified there is your pension (again, I've only read the first page). You say you're putting in 8% and your employer 3%, but where is it being invested once it's there?

ForestBluebells

QrizB said:

ForestBluebells said:

I only started saving and investing for my future/retirement January 2020, I’ve saved more than I could have originally thought possible with a strict budget and earning as much extra income to invest as I could but being so early in my journey my total pensions/investments still feels so low on my journey. 

How does everyone else keep motivated? I know it’s a long journey anyway but kind of lost my enthusiasm. 

Just remind yourself it's a marathon, not a sprint.

This is your thread?

https://forums.moneysavingexpert.com/discussion/6128270/head-out-of-the-sand-saving-for-a-shiny-future

Sounds like you're doing well. Based on the first post, every month you're saving roughly 2 weeks expenditure. Keep that up until you're 60 and you'll have 12-13 years' worth of spending squirelled away, before considering any growth.

One thing I don't see quantified there is your pension (again, I've only read the first page). You say you're putting in 8% and your employer 3%, but where is it being invested once it's there?

I’m averaging saving over 50% of all income (I’m doing 2 additional freelance jobs on top of my full time job to earn extra income to try speed up my savings so an additional 14 hours a week which is hard going but does significantly help). I’ll have more to invest once I’ve saved enough to replace my car too in about 12-18 months. 

I have a workplace pension which is 100% equities (80% world ex uk, 20% uk… I’m aware that’s heavily overweighted to the uk, not really sure why I put it in that allocation other than a strange thought uk had more growth to catch up on). My SIPP and S&S ISA 100% FTSE global all cap and my LISA 100% HSBC FTSE all world index.

 I guess I just know I’m still behind where I should be for my age so even though I am proud of what I have achieved, I’m not even close to where I should be at savings/pension wise. Maybe another looming birthday is making me feel more behind. 

I’ve got a figure in my head of wanting £100k wealth before I’ll feel a bit more stable, hoping to achieve that in the next 3 years but it just feels so slow at the start 

ForestBluebells

Reading back on that it does make me feel a bit better I guess as I have since saved my £10k emergency fund and paid off my student loan (although I didn’t really see much extra income after paying it off as all my bills increased and my salary didn’t 😑

QrizB

ForestBluebells said:

I guess I just know I’m still behind where I should be for my age so even though I am proud of what I have achieved, I’m not even close to where I should be at savings/pension wise. Maybe another looming birthday is making me feel more behind. 

I’ve got a figure in my head of wanting £100k wealth before I’ll feel a bit more stable, hoping to achieve that in the next 3 years but it just feels so slow at the start 

The very rough reckoner is that, when you start saving for retirement, you should be saving "half your age" % and don't drop below that until you retire. You started at 35 so your guide would be 17.5%. You're well above that so things are likely to work out.

The first £100k is the difficult one   after that growth starts to help. Right now for example VLS80 is up 22% in the past 12 months (admittedly, not a typical 12 months) so £100k in October 2020 would be £122k today, even if you hadn't saved a single penny more.

Just keep going and you'll get there

SouthCoastBoy

Just keep plugging away it is a long term project. If it is any consolation at the age of 40 I had no pension and 100k in a s&s isa. Now, at the age of 56, have a pot, combination of s&s isa and pension (sipp and workplace) greater than a million.

So just keep adding to your pot. Compounding is your friend.

ForestBluebells

SouthCoastBoy said:

Just keep plugging away it is a long term project. If it is any consolation at the age of 40 I had no pension and 100k in a s&s isa. Now, at the age of 56, have a pot, combination of s&s isa and pension (sipp and workplace) greater than a million.

So just keep adding to your pot. Compounding is your friend.

That is reassuring. I work really hard and always pay myself first as soon as I get paid. I guess in a few years I’ll feel better and more on track. I know I’m a heck of a lot better off than before I took action 22 months ago. 

tacpot12

It's a lifelong project, and one that hopefully you will never finish.    The main thing is that you have started. So many people never do, even if they are aware of why they should. 

I also remember thinking, when I started my pension, that the sums involved were so small, but I had already created a mathematical model of what my pension would, and what it would need to be, so I knew that if I stuck with it, the numbers would get quite large! 

bostonerimus

Compound interest and exponential growth will help your savings and investments to grow by larger and larger amounts as times goes by. But until you get to that point don't fret about it or look at your balance too often. 

[Deleted User]

Don’t think I ever felt frustrated about “how long”.  Had I felt like this it would have led to wrong decisions.  

JohnWinder

ForestBluebells said:

I’ve got a figure in my head of wanting £100k wealth before I’ll feel a bit more stable, hoping to achieve that in the next 3 years

I wouldn't think a portfolio of £100k would be more stable than one of £50k; indeed, a 20% drop in value would be more significant with the former. But surely rather than wanting your investment returns to steam ahead now you'd want them to fall deeply into negative territory so that all your diligent savings will buy you more assets which when their turn comes to blossom you're holding a lot more of them than otherwise. Think it through. It's blood in the streets you want, figuratively (a Rothchild reference to the battle at Waterloo aftermath).

not really sure why I put it in that allocation other than a strange thought

You'd find the answer to that in an investment policy statement, which sets out your aims, strategy, methods, reasoning, supporting information, or whatever you call them all. Then, during moments of self-doubt you refer back to it to avoid unnecessary changes or mistakes.