What % of salary do you put in your pension per month and why?

housebuyer143

Swipe said:

housebuyer143 said:

Albermarle said:

It’s an interesting balance, people tend to focus on having a large pot for retirement but do we focus and value that too much? I know people will disagree but you are only young once!

A lot if is down to your personality. Live for today type or a 'delayed gratification' type. There is a movement called FIRE- Financial Independence Retire Early, where they have good jobs, save like mad in their younger years and retire at 40 ( or earlier) . It is a bit extreme to say the least.

On the other side others work at least until state pension age, or even later,  because they can not afford to do otherwise. Not just low earners but some high earners with a high spend as well.

Clearly for most there is a happy medium in the middle. Average retirement age is around 62/62, although a bit earlier on this forum for many.

I'm not sure why everyone wants to rush to retire. I love my job and I can easily do it until I die, it's not manual at all. There is actually a guy working in my office who is 75 🤷‍♂️ he seems happy.

I work four hours a day now and would enjoy that in retirement also. Everyone I know who has retired has returned to some kind of work, not just for the money but for the social aspect too. 

Not everyone is social. I haven't seen my line manger or team members in person for well over 3 years now.

Agreed, I also hardly see anyone on my team, but the point still stands. Why is everyone in such a rush to retire? It's nice working if you like the job. 
I don't like being unemployed now and I don't see why I would like being retired personally. 

retiringtoosoon

Some people prefer to spend their time away from random work people.

housebuyer143

retiringtoosoon said:

Some people prefer to spend their time away from random work people.

If you work at home though you don't have to see random work people? I agree 100% on that front as hate small talk and generally going into the office, but working can be great if you find the ideal job you like.
Maybe it's because I have the perfect job now with a great work life balance that I can't see why I would choose to retire and do nothing in place of it. 

If you hate your job then of course retirement is great, or if it's manual and you can't do it anymore. I'm just saying it doesn't have to be all or nothing, plenty of different ways to do retirement and that's okay. Mine personally just doesn't involve me quitting work entirely.

Cus

Would you do your job for free? Do you have enough to retire without paid work? If it's a no then a yes then you should go do what you ideally want.

noclaf

My work hours are long and tend to be somewhat stressful. I don't love or hate the job though there are aspects that I enjoy more than others. Longer term, job security (or lack thereof) is definately something I am very much aware of, the industry is cyclical and such is the pace of change with technology (e.g: AI) that we can be sure that nothing stays constant, my team didn't exist 15 years back and who knows if it will 15 years in the future.

Additionally I doubt it will be sustainable to work long stressful hours into my 60's...whether I have the option to will be out of my hands anyway.

I am in no rush to reach retirement as am the type who needs something to occupy my mind but at the same time accept I must put something aside each month to support a comfortable retirement when it finally arrives....it's balancing the pension Vs non-pension investments over the next few years that is the bigger challenge for me personally.

LunaLater

Both my wife and I, as higher earners, are restricted to £4K per year or whatever the limit currently is, so don’t bother.

ZeroSum

housebuyer143 said:

Albermarle said:

It’s an interesting balance, people tend to focus on having a large pot for retirement but do we focus and value that too much? I know people will disagree but you are only young once!

A lot if is down to your personality. Live for today type or a 'delayed gratification' type. There is a movement called FIRE- Financial Independence Retire Early, where they have good jobs, save like mad in their younger years and retire at 40 ( or earlier) . It is a bit extreme to say the least.

On the other side others work at least until state pension age, or even later,  because they can not afford to do otherwise. Not just low earners but some high earners with a high spend as well.

Clearly for most there is a happy medium in the middle. Average retirement age is around 62/62, although a bit earlier on this forum for many.

I'm not sure why everyone wants to rush to retire. I love my job and I can easily do it until I die, it's not manual at all. There is actually a guy working in my office who is 75 🤷‍♂️ he seems happy.

I work four hours a day now and would enjoy that in retirement also. Everyone I know who has retired has returned to some kind of work, not just for the money but for the social aspect too. 

Good for you, but just because you don't hate your job, doesn't mean you want to continue it forever.

The only ones I know whove carried on working when they didn't need to were all quite greedy (and one had quite a bad health sacre & still hasn't quit). My dad packed in at 60 & has never looked back. Is generally a lot happier & healthier.

Unless you really really enjoy your work to the point its more of a hobby, life is too short to work into old age when you might not have your health. I don't mind my job (some of the management leave a lot to be desired, but that's another thing) but I'm packing in as soon as its financially viable. 

TheBanker

I don't hate my job, but I do enjoy days when I don't have to work (weekends, annual leave days etc). I won't reach 57 for another 15 years, so things could change by then. There are parts of my job I dislike, e.g. there are certain periods of the year when we are very busy and end up working longer days. Today (Sunday) I need to do some work that came up urgently on Friday and is needed for Monday. Whilst this is annoying, the need to do things like this is reflected in my salary. 

But whilst I enjoy my work, the question is do I enjoy it enough to want to keep doing it when I don't have to? My plan at the moment is probably to reduce my house as I get older. This may involve using some of my pension, but more likely I'll just reduce my hours and income. My mortgage will be paid off by then and I'll have built up a good pension pot. I might also take a pay cut by dropping a grade - let someone else be the boss and worry about the stuff that needs doing over the weekends etc. 

The point is having a decent pension pot gives me options. If I start to dislike my job, I might have the option to retire at a time of my choosing. If the company has a round of redundancies (which happens every now and again) I might be able to take advantage - their redundancy packages tend to be quite generous. 

There's also a personal point to this. My dad died at the age of 65. He fortunately retired when he was 61, so did get to enjoy a few years of retirement but it was not long enough. So my hope is to finish working by 60 at the latest. Obviously the final decision will depend on my circumstances at the time... but after a lifetime of work I'd like to enjoy my retirement, at least the early parts while I'm still hopefully in good health. 

[Deleted User]

I normally put 12% plus %10 from employer (they won'y put more). I lowed it down this year to pay off debts. So normally 22% a year. I aim to increase this to 25% next year. Although I may drop to 20% and spend the 5% on another asset as a backup. I don't really trust investment pensions really but they say its safe to an acceptable level,

I can't type below the quote, but yes it is an easy trap to fall into over covid it was just office and home non stop, we started to speak all the time because we could not meet friends,  but in the long run it is unwise and it does impact you if you start to spend more time with work. Your personal life starts to slip away. Don't do it!

retiringtoosoon said:

Some people prefer to spend their time away from random work people.

kuratowski

Some good comments in the latter part of this thread, and some of them resonate strongly.

I am currently 44, aiming to be financially independent (FI) at 52.  I think some FIRE adherents get a bit extreme, looking to quit work in their 30s/40s, and that can indeed mean sacrificing their youth to a high degree.  Whereas for me, retiring early simply means before state pension age (68 in my case).  Since my first job, where I accrued a modest DB pension having NRA 60, with no enhancement for deferral, it seemed natural to aim to be able to retire at 60, and I have always contributed extra to DC schemes to support that aim.  As things have worked out, my income and investments increased faster than I planned for, meanwhile I kept my expenditure more tightly under control, so the prospect of retiring in my early 50s has become achievable.  My father died at 75, my two grandfathers died at 65 and 55.  From my perspective, it's not in any way attractive to keep working to 68.

However, to me, the FI part of FIRE is a lot more important than the RE part.  My attitude is make hay while the sun shines.  I'm currently well-paid, and I can afford to put aside a healthy % of my income.  But there's a lot of ageism about, plus my specialism is quite confined, so if I were to lose my job in the next few years it might be quite difficult to find alternative employment at the same level.  So I'm saving now, knowing it won't last forever.  Like TheBanker, if a good redundancy offer came along, I'd like to be in a position to grab it with both hands.

As soon as I have saved enough to support myself without earnings, which my conservative forecasts indicate will be before age 52, I will probably climb off the career treadmill.  I've not made any cast iron decisions, options might be staying in my job part-time, switching to consulting, or switching to a lower paid role in the industry or an adjacent one, voluntary work in some capacity, etc.  My partner (same age as me) is in a fairly bullet proof job, mostly enjoys it, and will probably keep on working till 60+, so I don't want to be sitting around in the house alone all day long.