Average pension pot on retirement and whats your aim ?

Albermarle

Could be worth reading this recent thread .
Talking about student loan — MoneySavingExpert Forum

SouthCoastBoy

IamWood said:

SouthCoastBoy said:

Albermarle said:

The implication is that the more you earn the more you spend.

I would guess that is true for most people , but you are right it does not apply to everybody, and particularly not MSE posters !

I'm another one who earns £100k plus, but my spending has not changed. Live in a modest 3 bed house, have two cars both around 8 years old and small. I agree I think the percentage of take home pay is unhelpful. Most of my costs go on kids uni fees, about 50k for the two. Other than that I live a relatively frugal life.

Can you share why you didn't let your children take a student loan? My boy is going to university this summer. I wonder if it is worth letting my boy apply for a student loan even if I can afford his tuition. 

My children do get the minimum maintenance loan and a loan to pay for tuition fees. Basically I pay the accommodation around 8.5 k a year, both go to unis in expensive areas. One is also on a four year course, imagine with inflation kicking in I will be spending more than 50k. First years ere cheapest as halls were only around 5.5k. 

balbs

Workerdrone said:

lisyloo said:

Mick70 said:

Most folk aim
to retire well before state pension age IMO .  I would prob agree with the 2k/3k pm 

Do you mean most folks on here?
i know plenty of people with very little as shown by the average “pot”, whereas there are many people on here with 6 figure sums. I don’t think it’s at all representative.

But then again, as this is a forum filled with posters who do a lot of thinking and pension planning, I would expect the "average" and the "aim" on this particular thread to be fairly high. It's a bit like going to the Ferrari owners forum and asking the average price people are paying for an oil change. 

That made me smile! But its a serious point that its always worth keeping in mind that discussions on here  are very much a minority sport compared to the general population.... one of the very noticeable things in my own family and friends circle is the lack of knowledge about their pension arrangements and how things work (basics like do you even know what pensions you have...).   I have to start a lot of conversations with 'I have to point out Im not regulated to give you financial advice....'

Workerdrone

balbs said:

Workerdrone said:

lisyloo said:

Mick70 said:

Most folk aim
to retire well before state pension age IMO .  I would prob agree with the 2k/3k pm 

Do you mean most folks on here?
i know plenty of people with very little as shown by the average “pot”, whereas there are many people on here with 6 figure sums. I don’t think it’s at all representative.

But then again, as this is a forum filled with posters who do a lot of thinking and pension planning, I would expect the "average" and the "aim" on this particular thread to be fairly high. It's a bit like going to the Ferrari owners forum and asking the average price people are paying for an oil change. 

That made me smile! But its a serious point that its always worth keeping in mind that discussions on here  are very much a minority sport compared to the general population.... one of the very noticeable things in my own family and friends circle is the lack of knowledge about their pension arrangements and how things work (basics like do you even know what pensions you have...).   I have to start a lot of conversations with 'I have to point out Im not regulated to give you financial advice....'

It is quite astounding when you read the comments section on pensions articles or Facebook adverts just how many people take the line "Don't invest in a pension, the government will steal it from you". I've seen this sort of response time and time again. Im sure in a few year time those same people will be the ones calling for private pensions to be redistributed to help the poor (i.e them).

Albermarle

balbs said:

Workerdrone said:

lisyloo said:

Mick70 said:

Most folk aim
to retire well before state pension age IMO .  I would prob agree with the 2k/3k pm 

Do you mean most folks on here?
i know plenty of people with very little as shown by the average “pot”, whereas there are many people on here with 6 figure sums. I don’t think it’s at all representative.

But then again, as this is a forum filled with posters who do a lot of thinking and pension planning, I would expect the "average" and the "aim" on this particular thread to be fairly high. It's a bit like going to the Ferrari owners forum and asking the average price people are paying for an oil change. 

That made me smile! But its a serious point that its always worth keeping in mind that discussions on here  are very much a minority sport compared to the general population.... one of the very noticeable things in my own family and friends circle is the lack of knowledge about their pension arrangements and how things work (basics like do you even know what pensions you have...).   I have to start a lot of conversations with 'I have to point out Im not regulated to give you financial advice....'

You are right that the in house discussions on here are a minority sport. However the forum also functions to pass simple ( or as simple as can be in this area )  guidance on to the wider public ( or at least those who post their questions) who as you rightly say are lacking in knowledge in this area.

It is quite astounding when you read the comments section on pensions articles or Facebook adverts just how many people take the line "Don't invest in a pension, the government will steal it from you"

Even on here you often see the comment 'if the State Pension still exists when I get to that age ' , which is a nonsense as no government would ever do that as they would suffer a landslide defeat at the next election.

Workerdrone

Albermarle said:

balbs said:

Workerdrone said:

lisyloo said:

Mick70 said:

Most folk aim
to retire well before state pension age IMO .  I would prob agree with the 2k/3k pm 

Do you mean most folks on here?
i know plenty of people with very little as shown by the average “pot”, whereas there are many people on here with 6 figure sums. I don’t think it’s at all representative.

But then again, as this is a forum filled with posters who do a lot of thinking and pension planning, I would expect the "average" and the "aim" on this particular thread to be fairly high. It's a bit like going to the Ferrari owners forum and asking the average price people are paying for an oil change. 

That made me smile! But its a serious point that its always worth keeping in mind that discussions on here  are very much a minority sport compared to the general population.... one of the very noticeable things in my own family and friends circle is the lack of knowledge about their pension arrangements and how things work (basics like do you even know what pensions you have...).   I have to start a lot of conversations with 'I have to point out Im not regulated to give you financial advice....'

You are right that the in house discussions on here are a minority sport. However the forum also functions to pass simple ( or as simple as can be in this area )  guidance on to the wider public ( or at least those who post their questions) who as you rightly say are lacking in knowledge in this area.

It is quite astounding when you read the comments section on pensions articles or Facebook adverts just how many people take the line "Don't invest in a pension, the government will steal it from you"

Even on here you often see the comment 'if the State Pension still exists when I get to that age ' , which is a nonsense as no government would ever do that as they would suffer a landslide defeat at the next election.

There is however the possibility of the slow creep. The boil a frog approach. Some things are broadly tolerable to the general public. Take the winter fuel allowance which I don't believe is means tested. Most people would agree millionaires don't need it. I think a good many people of a certain political bent would say people with million pound pensions don't need the state pension so lets means test it. From then on its a gradual attrition.

QrizB

Workerdrone said:

There is however the possibility of the slow creep. The boil a frog approach. Some things are broadly tolerable to the general public. Take the winter fuel allowance which I don't believe is means tested. Most people would agree millionaires don't need it. I think a good many people of a certain political bent would say people with million pound pensions don't need the state pension so lets means test it. From then on its a gradual attrition.

I could imagine the SP going the same way as Child Benefit, with some sort of high-income charge that tapers it away for eg. higher-rate taxpayers.

Albermarle

QrizB said:

Workerdrone said:

There is however the possibility of the slow creep. The boil a frog approach. Some things are broadly tolerable to the general public. Take the winter fuel allowance which I don't believe is means tested. Most people would agree millionaires don't need it. I think a good many people of a certain political bent would say people with million pound pensions don't need the state pension so lets means test it. From then on its a gradual attrition.

I could imagine the SP going the same way as Child Benefit, with some sort of high-income charge that tapers it away for eg. higher-rate taxpayers.

Anything is possible I suppose, but I think probably the number of higher rate income tax paying pensioners is quite low.
I think around 15% of employed people pay 40% tax, but I would guess maybe only 5% in retirement ? Probably mainly those with big DB pensions. If you have a big DC pot and savings/ISA , you can manage to avoid paying 40% tax unless you are really in the money/big spender.
Then there would have to be some kind of complicated transition arrangements, so the immediate benefits to the Treasury would probably be limited .

adonis10

38 with £90k in a DC scheme currently. Pay in £13k/annum (e’ee and e’er) so would like to think by 60 it’ll have grown to £400-500k for a very modest retirement. Reality will be working until 70 but be nice to have £500k to be going on with after that.

Albermarle

£500K looks more realistic and that is way above the average .
You should be able to pretty safely generate an income from that around £17K pa 
If you retired before your state pension was payable you could take some more than that and then reduce it when the SP comes along . 
So do not think you will need to work until 70 unless you really wanted to . Even if you worked just two or three years past 60 then you should have a bigger pot still and less years to fund .