I'm addicted to pension saving and it's leaving me short.

IAMIAM

Murielson said:

Don't quite understand where Civil Service pension comes into the discussion for the original poster, maybe I'm missing something?

I'm quite lucky in that I have also been able to not take a pay rise in the last 7 or so years and everything has gone directly into pension. Wife and my salary have been such that we can accommodate this and with salary sacrifice, I am using pension route for tax efficiency and saving for the future (pension) and this year actually took a salary cut with balance heading to pension

Wife is in Civil Service and also wishes to retire at age 60 in 2 years time so that is what we will also be doing, similar to OP target retirement date

Just remember to leave yourself with enough to live on comfortably so that you can continue the life you have been having in retirement rather than actually starting to live then

It come from this....

My fund seems to have stagnated at around £240k (Im not concerned, Im just buying more units at a cheaper price month on month), but the lack of northward direction does make all this saving for no obvious gain seem a bit demoralising.

IAMIAM

This could be part transferred into a civil service pension and actually get a boosted income or actually increase in value via inflation instead of having 240k sat there for 10 years not moving at all in value - which is what many have at the moment! 

Workerdrone

Emmia said:

Do you have another payrise coming up?

Perhaps this time, and next time, don't adjust the additional contribution, but let the rise flow into your bank account.

You're still piling money away with nearly £1,500 a month going in but perhaps it's time to have a little more disposable income & to enjoy the payrises.

I believe the next pay review will be June 2024. I think the freezing of personal tax thresholds along with higher than usual inflation is what's made my usual parsimony a little more uncomfortable. Although the now baked in inflationary hikes have made saving more for the future a bigger priority.

Marcon

IAMIAM said:

I also know someone, who lent 50k from their mortgage lender for an 'extension' at age 58.
Bought the maximum additional civil service pension with it (7k). 
Went part time for a whole year to claim the 20% tax relief back on it.
Then went back to full time until age 60.
Retired age 60.
Took the maximum lump sum from the pension.
Paid off mortgage.
Lives happily ever after! 

Where does going 'part time...to claim the 20% tax relief back on it' come into this? Why not continue to work full time and get 40% relief - presumably they were in a higher rate tax bracket if they had scope to contribute a one-off £50K lump sum?

Workerdrone

IAMIAM said:

Murielson said:

Don't quite understand where Civil Service pension comes into the discussion for the original poster, maybe I'm missing something?

I'm quite lucky in that I have also been able to not take a pay rise in the last 7 or so years and everything has gone directly into pension. Wife and my salary have been such that we can accommodate this and with salary sacrifice, I am using pension route for tax efficiency and saving for the future (pension) and this year actually took a salary cut with balance heading to pension

Wife is in Civil Service and also wishes to retire at age 60 in 2 years time so that is what we will also be doing, similar to OP target retirement date

Just remember to leave yourself with enough to live on comfortably so that you can continue the life you have been having in retirement rather than actually starting to live then

It come from this....

My fund seems to have stagnated at around £240k (Im not concerned, Im just buying more units at a cheaper price month on month), but the lack of northward direction does make all this saving for no obvious gain seem a bit demoralising.

Units as in units of a particular fund. Its DC rather than Civil Service

IAMIAM

Marcon said:

IAMIAM said:

I also know someone, who lent 50k from their mortgage lender for an 'extension' at age 58.
Bought the maximum additional civil service pension with it (7k). 
Went part time for a whole year to claim the 20% tax relief back on it.
Then went back to full time until age 60.
Retired age 60.
Took the maximum lump sum from the pension.
Paid off mortgage.
Lives happily ever after! 

Where does going 'part time...to claim the 20% tax relief back on it' come into this? Why not continue to work full time and get 40% relief - presumably they were in a higher rate tax bracket if they had scope to contribute a one-off £50K lump sum?

The 50k came from a mortgage lender. You didn't read. 

barnstar2077

Is it possible that the real issue is not being able to see your gains recently as things have been a bit stagnant of late?

It is difficult, because you could put less away and then regret it later and wish you had stayed the course!

I struggle with this myself sometimes, it is a fine balance indeed.  I am trying to retire at 55, am currently 46 and am on less than 19k a year, so from my point of view you are in a great position already!

Emmia

Workerdrone said:

Emmia said:

Do you have another payrise coming up?

Perhaps this time, and next time, don't adjust the additional contribution, but let the rise flow into your bank account.

You're still piling money away with nearly £1,500 a month going in but perhaps it's time to have a little more disposable income & to enjoy the payrises.

I believe the next pay review will be June 2024. I think the freezing of personal tax thresholds along with higher than usual inflation is what's made my usual parsimony a little more uncomfortable. Although the now baked in inflationary hikes have made saving more for the future a bigger priority.

The financial "difficulty" you're in though is of your own making - you've chosen to put additional monies into your pension, leaving you with the effect of frozen take home pay - inflation has eroded the value of that money, and so you face difficulties. 

Fixing it is simple, reduce your pension over payments, or don't increase your contribution level when your next pay rise happens so you get an uplift in your income. 

MEM62

gwynlas said:

Whilst your saving is admirable it appears to have become an obsession and a lot could happen in the next 20 years. Your wife might change roles so no longer working nights or either of you could suffer a life changing illness. 

Spot on. My cousin (two years younger than me) saved hard all his life dreaming about the amazing retirement that he was hoping to have.  Cancer took him last year.  He didn't enjoy as much as he could have when alive and didn't get to retirement.  We should understand that this affects a minority of people and not the majority but it does underline the fact that tomorrow is not a given.  I shall retire next year at 62 although plan a was to wait and build the finances a bit further.  We will still be comfortable and be able to do all the things we want to but the pot may be a little smaller than originally planned and I am cool with that.      

Workerdrone

Emmia said:

Workerdrone said:

Emmia said:

Do you have another payrise coming up?

Perhaps this time, and next time, don't adjust the additional contribution, but let the rise flow into your bank account.

You're still piling money away with nearly £1,500 a month going in but perhaps it's time to have a little more disposable income & to enjoy the payrises.

I believe the next pay review will be June 2024. I think the freezing of personal tax thresholds along with higher than usual inflation is what's made my usual parsimony a little more uncomfortable. Although the now baked in inflationary hikes have made saving more for the future a bigger priority.

The financial "difficulty" you're in though is of your own making - you've chosen to put additional monies into your pension, leaving you with the effect of frozen take home pay - inflation has eroded the value of that money, and so you face difficulties. 

Fixing it is simple, reduce your pension over payments, or don't increase your contribution level when your next pay rise happens so you get an uplift in your income. 

Im aware its not really difficulty in the sense that many people have difficulty. I have multiple levels of resilience to fall back on, savings pots, other investments, assets etc. It's a one of mindset and perhaps a cautionary tale to this who frequent forums like this. Perhaps some unfortunate event is required to shake me from the current path. Im trying hard to be cognoscent of the problem but making a change is difficult.