Average pension pot on retirement and whats your aim ?

mat1964

Ibrahim5 said:

Mine is roughly 50:50. I think it's good. The thought of 100% DC terrifies me. I am sure someone will say "actually it isn't a problem". Well it won't be a problem when the stock market is doing well.

I think if you have a large enough DC pot, then it won't matter so much.  I only have a smallish DC pot so glad to have a DB if only £11k a year, as that covers our main fixed expenses which are the Council tax and Utility bills.   The DC pot with the DB will cover us to state pension age and then we will have £30k pa plus whatever is left of our DC pots.  

Albermarle

Ibrahim5 said:

Mine is roughly 50:50. I think it's good. The thought of 100% DC terrifies me. I am sure someone will say "actually it isn't a problem". Well it won't be a problem when the stock market is doing well.

If it worries you so much, you can always let someone else manage it for you , like an IFA?

Ibrahim5

Albermarle said:

Ibrahim5 said:

Mine is roughly 50:50. I think it's good. The thought of 100% DC terrifies me. I am sure someone will say "actually it isn't a problem". Well it won't be a problem when the stock market is doing well.

If it worries you so much, you can always let someone else manage it for you , like an IFA?

I am not worried because I don't have a 100% DC pension. Employing an IFA just makes it worse. If things are bad they always make sure that they get their bit.

Thrugelmir

Albermarle said:

Ibrahim5 said:

Mine is roughly 50:50. I think it's good. The thought of 100% DC terrifies me. I am sure someone will say "actually it isn't a problem". Well it won't be a problem when the stock market is doing well.

If it worries you so much, you can always let someone else manage it for you , like an IFA?

Management isn't the issue. It's the volatility of the markets and lack of "safe" options that are the challenges for the foreseeable future. Nothing in the history books to read to help map the outcome. 

SouthCoastBoy

Albermarle said:

SouthCoastBoy said:

Ibrahim5 said:

Mine is roughly 50:50. I think it's good. The thought of 100% DC terrifies me. I am sure someone will say "actually it isn't a problem". Well it won't be a problem when the stock market is doing well.

It terrifies me as well, unfortunately that is the position I'm in. DW has a 9k db pension so some hedging there.

Due to my dependence on a dc pension I will be working for a while yet. Actually not sure when I will have the confidence to retire. Currently set at 60 but don't think I will have the courage to go.

DB pension expressed in DC terms? I'd go for around 30x

If I remember correctly from previous threads you also have around half a Million in non pension investments and cash .
So between you , you have about £1.8 M but still nervous about retiring in two years time .......

Maybe time to throw caution to the wind ?

Not quite, currently got around 630k in pension and 650k outside pension. I'm expecting this to decrease in real terms over the next few years both due to inflation, as have 40% cash, and stock market performance so thinking pot of 1m in real terms in 3 years time when 60

bostonerimus

Thrugelmir said:

Albermarle said:

Ibrahim5 said:

Mine is roughly 50:50. I think it's good. The thought of 100% DC terrifies me. I am sure someone will say "actually it isn't a problem". Well it won't be a problem when the stock market is doing well.

If it worries you so much, you can always let someone else manage it for you , like an IFA?

Management isn't the issue. It's the volatility of the markets and lack of "safe" options that are the challenges for the foreseeable future. Nothing in the history books to read to help map the outcome. 

Agreed. "Safe" options are expensive. The DC approach has been sold to people as being flexible and potentially giving them a larger income when compared to products like annuities and DB pensions. That looks good on a spreadsheet if you put in the right numbers, but I now worry that we will see some serious "sequence or return" consequences to people's retirement plans.

Kim1965

Seens the db is a winner. I get the 8k at 60 cannot defer it, my mind us foccused that at 60 there is a financial event that I have nit initiated. At the least i will reduce my working week by a day or two.
 If the 8k inflation proofed db was an extra 240 k in my dc pot, I ubdoubtably wouldnt feel as inclined to make a change. I would be thinking about inflation stock market falls etc.
 The curse if the dc only retirement is that people work way longer to nail down a retirement beyond any reasonable doubt... Then still worry about it when they have finished work. 

Mick70

If the DB rises annually with rpi (even if capped at 5%) it makes a massive difference , factor is much higher than 30-35, IMO , even more so if you can access it in your 50s

Albermarle

 The curse if the dc only retirement is that people work way longer to nail down a retirement beyond any reasonable doubt... Then still worry about it when they have finished work. 

Luckily I am DC + DB , but the former is approx double value the latter + smaller amount in S&S ISA's and cash.

I worked probably two or three years longer than really necessary to as you say ' to nail down a retirement beyond any reasonable doubt...

However due to this I don't worry about it anymore .....

Mutton_Geoff

My fag packet sums would be a basic level of comfort of £2k a month single person or £3k a month per couple (net excluding any rent/mortgage).

Assuming state pension of £10k year and a drawdown of 4% to leave the pot empty means a fund of £425k to provide for the £17k top up before tax to end up with £14k net, plus state = £24k.

For a couple, two lots of state pension and two lots of tax code means not much more to provide for the pair of you.

For every year ahead of state pension age you want to retire, you'll need to add £24k/£36k to the pot, plus any income tax that may be payable if funds not from an ISA.

Very approximate figures. Your mileage may vary.