Looking for advice 5 years from retirement

Doctor_Who

RichardS said:

LHW99 said:

 I am due the full state pension at 67

Have you actually checked that, and read all the page? You are under transitional rules so could need anything between around 29 and 49 contribution years (from what others have said here).

Yes I think I did check that. I’ve worked continuously since 22 so have 35 contribution years so far

You can't just assume 35 years will get you a full state pension, that only applies to those starting work after 2016. For those under transitional rules the number of years NI contributions for a full state pension is highly variable.

wjr4

Can you actually afford to retire? What income do you need in retirement? As it’ll have to be a lot less than £60k per annum. 

Andreg

Are your company pension contributions done by salary sacrifice?  If so, you should make additional contributions to your company pension instead of  your personal pension, as salary sacrifice contributions reduce your National Insurance contributions.

Andreg

RichardS said:

2. With a pension fund should I be worried at all about the safety of the fund i.e is it ok to have more than £85k invested in one place?  I know people consolidate pensions but is this not an issue?

The FSCS £85k rules do not apply to pension funds.  Instead these are subject to client money type regulations where your pension fund assets are held separately from the pension administrator & fund managers.  So in theory you don't have to worry about these companies going bust.

boingy

I'd echo most of the above advice. If you only do one thing then it should be to transfer the pension away from the FA wealth management service to a lower cost provider. Those fees are brutal and you don't need to be paying them.

Your company scheme will have someone you can talk to. Ask them how much more you can put into the company pension each month and aim to max those contributions and reduce the other payments accordingly. It might also be possible to transfer the other pension into the company one but seek some advice about that and pay attention to exit and transfer fees. 

RichardS

Doctor_Who said:

RichardS said:

LHW99 said:

 I am due the full state pension at 67

Have you actually checked that, and read all the page? You are under transitional rules so could need anything between around 29 and 49 contribution years (from what others have said here).

Yes I think I did check that. I’ve worked continuously since 22 so have 35 contribution years so far

You can't just assume 35 years will get you a full state pension, that only applies to those starting work after 2016. For those under transitional rules the number of years NI contributions for a full state pension is highly variable.

Well, like I said, I did check it and I’m pretty sure it said I would get the full pension but I will check again. Thanks. 

RichardS

Andreg said:

Are your company pension contributions done by salary sacrifice?  If so, you should make additional contributions to your company pension instead of  your personal pension, as salary sacrifice contributions reduce your National Insurance contributions.

Yes they are. I did look at increasing my % a little bit but it came up with a warning about my contributions being above £10k which may have tax implications so I thought I would check this out first. Does that sound likely - that going over 10k would cause this?

RichardS

wjr4 said:

Can you actually afford to retire? What income do you need in retirement? As it’ll have to be a lot less than £60k per annum. 

Current projections show income of around £30k (from aged 67) for me and also around £30k for my wife (from aged 67). So my objective is to see if I can afford to bridge the gap between 62 and 67

RichardS

boingy said:

I'd echo most of the above advice. If you only do one thing then it should be to transfer the pension away from the FA wealth management service to a lower cost provider. Those fees are brutal and you don't need to be paying them.

Your company scheme will have someone you can talk to. Ask them how much more you can put into the company pension each month and aim to max those contributions and reduce the other payments accordingly. It might also be possible to transfer the other pension into the company one but seek some advice about that and pay attention to exit and transfer fees. 

Thank you!  I may well look into doing this. 

RichardS

jimjames said:

Could you pay more into your company pension to get that employer contribution up? Is that the maximum they add? You might find it's better to add more to the company pension if that has lower charges.

In terms of risk, you need to think about what you intend doing with your pension at retirement. Are you planning to buy an annuity or use drawdown? If drawdown and it has to last 20+ years then you will probably still want to keep some equities there to ensure it grows to beat inflation over that time.

Yes the 4% is the max they will pay in. I did look at increasing my payments in but the system gave me a warning saying that my contributions would then be over £10k and there might be a tax implication?  So I may have to look into that. Thank you!