Obsessed with pension planning and saving?

FIREmenow

Thanks everyone for your response. 
@gm0 you make a good case for starting our toddler a SIPP, thanks. I think we would balance it with the JISA so that there wasn't such a long wait to get access to some cash. 

@noclaf you sound very similar to me, thanks!  I agree with @Dh6 and am buying units now and going that things get better in the long- term. 

@SouthCoastBoy and  @Mutton_Geoff do you have hard limits that stop the obsession going to far? 

Universidad

FIREmenow said:

Thanks Universidad, am I right in thinking you are/were in USS? Is that the pension you went from or to? I'm in USS now and it's sad the state is in and how much strike action it has taken to get to where things are now. I'm hoping to capitalise on the sal sac of extra contributions into the DC part for a bigger lump sum. 

If you've left HE, is the gold-plated pension civil service? I did look at CS jobs in my mat leave as the 2022 cuts to USS were happening. Although I put a high value on the team I work with and the satisfaction I get from helping students at the moment. So the new unknowns of a different sector,  or moving to a post-92 to join the TPS haven't convinced me yet. 

Yes, I was in USS for a good many years, and when last year's cuts went through I quit.

Like you, I take value from being able to make a positive difference in the world. Sadly, my experience is that universities will use that against you - the passion tax is real.

I'm now in the Civil Service scheme, and taking that pension into account this is the first time since the 2000s that I have felt like I'm being well compensated for my work - it's night and day. I wish I'd done it earlier - plenty of my colleagues left for similar reasons long before I did, I took far too long to cotton on.

The pension cut was definitively the reason I left, but certainly for me most of the pull factors had gone, so it was a much easier decision to make than it would have been earlier in my career.

Salary supression meant that I was being paid the same in real terms for about 15 years, no matter how much of myself I put in -  promotions, spinal point increments, and taking on endless responsibilities, all just left me treading water. And it just seemed like sooner or later I'd probably sink. 

Now the unknowns of a different sector don't concern me too much - the more places I end up working in the more transferrable skills I'll pick up. And it doesn't feel like I have anything left to prove, or like there'll ever be anything I mind walking away from. It's just a job. If I ever land on a bad one, there'll be another along soon enough.

Mutton_Geoff

FIREmenow said:

  @Mutton_Geoff do you have hard limits that stop the obsession going to far? 

Yes, the AA/LTA although the latter was brought down to engulf me after I was building up to the old £1.8m limit.

I am fortunate that the LTA tax has been removed days before a DB BCE took place saving me a large tax bill & resultant severe commutation of DB benefit.

bostonerimus

I've never been particularly obsessed with what to invest in, having decided to use a simple index tracker portfolio 30 years ago. However, in the accumulation phase I was obsessed with planning and meeting my goals. At some times I was saving lots into pensions and general accounts and at other times making extra mortgage payments. Now that I'm retired and have more than met my financial goals I've lost a lot of interest and just let the plan that I put in place play out.

leosayer

Financial planning has effectively been a second job for me after I decided to start looking into retirement arrangements after my employer stopped further accruals into their DB scheme.

Now I'm a couple of years away from retirement I don't regret the time spent one bit.

Pipthecat

I'm in my 50's looking to retire in 60's and I would describe myself as very conscious of, rather than obsessed with.  I'm struggling to balance enjoying life now with making provision for the future.  Fingers crossed I get the balance right. 

SpeedSouth

I think this is me.  My missus would certainly say I am obsessed with my/our pensions, to the point it is part of my 10 year old's vocabulary.

Similar to another post earlier, when I was mid 30's I had very little in my pension.  Now I drop 67% of my salary in via sal sac. I tell myself it's tax efficient and will allow me to retire early.  Hopefully before 60, we can afford it, but that means we live more frugally than we would need to on our salaries.  We don't really want for anything else, but I will never spend money on myself as I see it as a "waste".

Clearly if I get there and enjoy a healthy retirement it will all be worth it, but that's the caveat.  I'm telling myself that when I have built this large pot I can scale back a bit as the kids get older and more expensive (uni/cars/houses etc), and take some more of the salary as take home, but of course relies on equivalent salaries as I get to that point.

The opposite way to most who start ramping the contributions in their late 40s/ early 50s I'd guess, but I feel if the base point is good then the plan can flex as it needs to.

Make hay whilst the sun shines is my thoughts!

Nevergonnaretire

Obsessed, well in the last 6 months or so I would say I probably am! I'm sure my wife would agree

A year ago we had little savings (less than 5K), a mortgage and was paying 10% of my Salary into my workplace pension via SS (employer matches 10%). I'd looked at my pension forecasts a couple of times and was getting to the point where I knew even though my mortgage was almost paid up there was a chance I'd likely never retire lol.

Fast forward a year, mortgage is now paid up (what a moment that was!) I've recently upped my pension contributions to 20% (so 30% with the employer contribution), I've started a S&S ISA and finally have what I'd call a realistic emergency cash buffer that we've never managed in the past and always left me uneasy.

I spend wayyyyyyy to much time watching videos on retirement planning etc. and I'm aware I really do need to find a balance as its all In think about these days! I'm 51 this year and planning to retire by 60 if I can manage it, the earlier the better. I fell out of love for my IT job a couple of years ago and although the pay is OK, I just don't enjoy it anymore. 30 years has took its toll lol.

Albermarle

One relevant point maybe is that if you are the saving type, a bit cautious with money, spending etc., is that it is probably not a good idea to retire when you have only just about enough. Most likely you will get even more cautious, and not do  yourself and your family any favours with any Scrooge like behaviour.
So if you are this way inclined, then probable better to retire with too much/ a good buffer, which is what I have done. It has actually worked as having been retired nearly two years I, 

1) Worry about money less than when I was younger
2) Although I take an active interest in pensions, investments, money etc I am not anxiously counting my 'gold' every day.
3) Although I am still not a lavish spender and never will be, I am only loosely monitoring family expenditure and even shop at Waitrose sometimes !
4) Also maybe against the general trend of forum regulars. No poring over spreadsheets, or running scenarios through retirement or cash flow  planners. I was never a spreadsheet fan at work, so last thing I wanted to do when retired. ( Of course I do have some records, which I update very 6 months or so)

So I am glad in the end I worked OMY ( or two or three ) as it has aided my peace of mind, and helped me relax about spending ( to a point) .

Rich1976

I wouldn’t say I am obsessed with pensions, at least not now. I used to be and would read investment magazines and the financial articles in the weekend news papers promoting the latest star fund, contribute to that and become disillusioned when it’s performance tails off and another fund is promoted instead. I was also contributing too much based on what our incomes were at the time to an extent where we hadn’t got enough in a savings account or the car needed replacing but the only option was to get a loan.

it has only really been since lockdown that we have finally got a firm grip on our finances. 

The big downside with pensions or any investment is the unknown. Sometimes I would like to retire at 58, sometimes it’s 60 and other times it’s mid to late 60s. So I would like it to be a choice of when I can retire rather then being forced too.

on the positive side we have both been paying into pensions since about 1997 and apart from a 3 or 4 year gap has generally been consistent.

the annual statements from work and our own personal provider makes depressing reading and no wonder so many people dismiss pensions as not being worth it. Neither of us have been big earners but we do our best.

so for now at least until the mortgage is paid off in 4 years, we pay the maximum to our work pensions that allows for the maximum employment match ( the bare minimum the employer can do in both cases as neither contribute above the 4%) and then we each pay £100 a month extra into our own pensions.

we are left with a healthy amount after the bills have been paid each month but since lockdown we have been focusing on more short term savings as the car will need replacing in a couple of years, plus we are doing home improvements a bit at a time over the next few years too.

so whilst we could pay more than we are into pensions, it is what it is. There needs to be a balance which is why I don’t obsess about pensions or retirement anymore. I do think about them regularly and the big question is will it be enough is the one I keep returning back to.  but then we could get to 60 and have a substantial pension fund but a dated run down house and no life experiences from holidays etc.

unfortunately we won’t know until nearer the time and that’s why I wish there was still final salary type pensions where you know from the outset what it would be worth and not some as yet unknown number which is wholly dependent on the stock market.

I also don’t obsess over the funds they are invested in anymore. I realised before that I was investing well above my risk profile and when the markets crashed I would do ultimately the wrong thing and stop contributing until things got better. So now I am perfectly happy in my work lifestyle fund and a multi asset fund for my Sipp.