Pension I am a wondering......

HotDog2020

Hi All,

I am just deciding at the moment whether to start adding money to the pension, the idea being that I won't pay as much tax overall, but most importantly I feel that I won't have a pension in the future or not much of one if I don't start acting now. The governement seems to have decided not to have national insurance any more this means I need to be paying into a pot or there won't be any future, I need to protect myself. And I would feel a whole lots less dependant on the state pension. Also as I do not know what the future holds but I have always been a firm believer in preparing for every eventuality. I have worked out that if I pay in £100 Per week, which is 25% of wages I would lose £65 per week, but heres the rub.....

With The money I am on now I always want more, I never feel like I have enough - But I beleive this is because I had some money growing up, and I even lived rent free at home for some time before moving out, and I had enough money that when I wanted to go away (a Nice holiday - not what I have now coach trip if I am lucky) but I could save for it in a few weeks, now I cannot do that and feel like my money is not enough.

However I beleive if my pay packet is reduced I would always live within my means and I really want to get the most benefit out of my wages. Also I feel if I have less money I will not splash out on things as it is restrictive, also I would be less worried about my future (if I feel secure in my job) I guess I could try and then if I find myself unable to suceed I can go back to a lower percentage. 

Does anyone have any views or inspirational view points regarding above please?

Marcon

HotDog2020 said:

Hi All,

I am just deciding at the moment whether to start adding money to the pension, the idea being that I won't pay as much tax overall, but most importantly I feel that I won't have a pension in the future or not much of one if I don't start acting now. The governement seems to have decided not to have national insurance any more this means I need to be paying into a pot or there won't be any future, I need to protect myself. And I would feel a whole lots less dependant on the state pension. Also as I do not know what the future holds but I have always been a firm believer in preparing for every eventuality. I have worked out that if I pay in £100 Per week, which is 25% of wages I would lose £65 per week, but heres the rub.....

With The money I am on now I always want more, I never feel like I have enough - But I beleive this is because I had some money growing up, and I even lived rent free at home for some time before moving out, and I had enough money that when I wanted to go away (a Nice holiday - not what I have now coach trip if I am lucky) but I could save for it in a few weeks, now I cannot do that and feel like my money is not enough.

However I beleive if my pay packet is reduced I would always live within my means and I really want to get the most benefit out of my wages. Also I feel if I have less money I will not splash out on things as it is restrictive, also I would be less worried about my future (if I feel secure in my job) I guess I could try and then if I find myself unable to suceed I can go back to a lower percentage. 

Does anyone have any views or inspirational view points regarding above please?

You're clearly in employment. Have you opted out of your employer's pension scheme? If so, you are giving up 'free money' - your employer must contribute if you do.

HotDog2020

Marcon said:

HotDog2020 said:

Hi All,

I am just deciding at the moment whether to start adding money to the pension, the idea being that I won't pay as much tax overall, but most importantly I feel that I won't have a pension in the future or not much of one if I don't start acting now. The governement seems to have decided not to have national insurance any more this means I need to be paying into a pot or there won't be any future, I need to protect myself. And I would feel a whole lots less dependant on the state pension. Also as I do not know what the future holds but I have always been a firm believer in preparing for every eventuality. I have worked out that if I pay in £100 Per week, which is 25% of wages I would lose £65 per week, but heres the rub.....

With The money I am on now I always want more, I never feel like I have enough - But I beleive this is because I had some money growing up, and I even lived rent free at home for some time before moving out, and I had enough money that when I wanted to go away (a Nice holiday - not what I have now coach trip if I am lucky) but I could save for it in a few weeks, now I cannot do that and feel like my money is not enough.

However I beleive if my pay packet is reduced I would always live within my means and I really want to get the most benefit out of my wages. Also I feel if I have less money I will not splash out on things as it is restrictive, also I would be less worried about my future (if I feel secure in my job) I guess I could try and then if I find myself unable to suceed I can go back to a lower percentage. 

Does anyone have any views or inspirational view points regarding above please?

You're clearly in employment. Have you opted out of your employer's pension scheme? If so, you are giving up 'free money' - your employer must contribute if you do.

Thanks Marcon, I did not explain myself very well, I currently opt in with minimum 4% however to get a worthwhile pension so I can actually retire I need to put in 25% of wages, which will I believe see a drop of £65 per week, from £420 to £355 per week money and I was wondering if on my wages it is wise - I have just sent off the email to request it to see how I get on, but I am not sure it is wise, I am unhealthy but I am trying to turn it all around, and a more restrictive wage would mean I buy less take out etc. However I would get more out of it, pay less tax etc. Also I might still be a little short in retirement. I am 40 this is based on there will be no state pension when I grow up. If I don't increase my pension contribution I will have 2.5kpa I need at least 12kpa with mortgage paid off.

Marcon

HotDog2020 said:

Marcon said:

HotDog2020 said:

Hi All,

I am just deciding at the moment whether to start adding money to the pension, the idea being that I won't pay as much tax overall, but most importantly I feel that I won't have a pension in the future or not much of one if I don't start acting now. The governement seems to have decided not to have national insurance any more this means I need to be paying into a pot or there won't be any future, I need to protect myself. And I would feel a whole lots less dependant on the state pension. Also as I do not know what the future holds but I have always been a firm believer in preparing for every eventuality. I have worked out that if I pay in £100 Per week, which is 25% of wages I would lose £65 per week, but heres the rub.....

With The money I am on now I always want more, I never feel like I have enough - But I beleive this is because I had some money growing up, and I even lived rent free at home for some time before moving out, and I had enough money that when I wanted to go away (a Nice holiday - not what I have now coach trip if I am lucky) but I could save for it in a few weeks, now I cannot do that and feel like my money is not enough.

However I beleive if my pay packet is reduced I would always live within my means and I really want to get the most benefit out of my wages. Also I feel if I have less money I will not splash out on things as it is restrictive, also I would be less worried about my future (if I feel secure in my job) I guess I could try and then if I find myself unable to suceed I can go back to a lower percentage. 

Does anyone have any views or inspirational view points regarding above please?

You're clearly in employment. Have you opted out of your employer's pension scheme? If so, you are giving up 'free money' - your employer must contribute if you do.

Thanks Marcon, I did not explain myself very well, I currently opt in with minimum 4% however to get a worthwhile pension so I can actually retire I need to put in 25% of wages, which will I believe see a drop of £65 per week, from £420 to £355 per week money and I was wondering if on my wages it is wise - I have just sent off the email to request it to see how I get on, but I am not sure it is wise, I am unhealthy but I am trying to turn it all around, and a more restrictive wage would mean I buy less take out etc. However I would get more out of it, pay less tax etc. Also I might still be a little short in retirement. I am 40 this is based on there will be no state pension when I grow up.

Excellent - at least you are in the scheme! Two thoughts: will your employer pay more if you pay more (some will, many won't); and can you/do you make contributions by salary sacrifice, thus saving some NI?

Is it realistic to tie up so much of your cash in a pension, when you won't be able to access it for at least another 17 years? Do you have a decent 'rainy day' fund in case the worst happens and you lose your job, or some other major adverse event? Going from 4% to 25% is a huge jump and although commendable for its objective, might not be realistic or sustainable longer term. 

Just a thought...you could buy fewer take outs even if you don't contribute more to your pension!

HotDog2020

Thanks @Marcon I know it is a lot, but if there is no state pension when I come to retirment age what am I going to live on? I work for a lovely company but tight on cash they pay only the bare minimum. 

Also I did have a role where I earnt I think 18kpa not that long ago for a short time, now I am on 28kpa, I know that I can live on both, I may not have the disposable and I will feel the pinch, but if I learn to live on less I may have a future. However you may be right and it is too restrictive however my mother has said a few times that if I was to have less wages there will be less to spend on food - I always live within my means. I have planned week to week money, I have have planned to eat healthier, I am starting a new plan on April 2nd, however the shopping arrives 29.03.24 so will start then. I am waffling. 

I just have been worried about having a future and I have been worried about my health at the same time - it might be that if I am saving into a pension I will want my health to be better otherwise there is no point. And I know a few seniors in my industry and they are not on the ball, most senior people do not work for a good reason. I don't want to end up without a pension and without a job. Also this is based on retiring at 70!

xylophone

 I am 40 this is based on there will be no state pension when I grow up. 

Have you checked your state pension forecast?

https://www.gov.uk/check-state-pension

Assume you mean grow old rather than grow up?

The governement seems to have decided not to have national insurance any more 

I don't understand this statement.

See https://www.litrg.org.uk/tax-nic/national-insurance#:~:text=From 6 January 2024, the,NIC is no longer due.

But  it's true to say that just a state pension won't  provide for a comfortable retirement.

It will provide a secure and index linked base on which you can build.

From 8 April, a full new state pension will be  over £11,500 a year.

It would be a good idea to increase your workplace pension contributions by what you can afford.

https://www.moneyhelper.org.uk/en/tools-and-calculators?gad_source=1&gclid=EAIaIQobChMIsMzfr5yLhQMVAJNQBh05rQC8EAAYAiAAEgL_mfD_BwE&gclsrc=aw.ds

Marcon

HotDog2020 said:

Thanks @Marcon I know it is a lot, but if there is no state pension when I come to retirment age what am I going to live on? I work for a lovely company but tight on cash they pay only the bare minimum. 

Also I did have a role where I earnt I think 18kpa not that long ago for a short time, now I am on 28kpa, I know that I can live on both, I may not have the disposable and I will feel the pinch, but if I learn to live on less I may have a future. However you may be right and it is too restrictive however my mother has said a few times that if I was to have less wages there will be less to spend on food - I always live within my means. I have planned week to week money, I have have planned to eat healthier, I am starting a new plan on April 2nd, however the shopping arrives 29.03.24 so will start then. I am waffling. 

I just have been worried about having a future and I have been worried about my health at the same time - it might be that if I am saving into a pension I will want my health to be better otherwise there is no point. And I know a few seniors in my industry and they are not on the ball, most senior people do not work for a good reason. I don't want to end up without a pension and without a job. Also this is based on retiring at 70!

I think working on the premise that you'll retire at 70 and there'll be no state pension is probably a tad pessimistic - actually rather more than just a tad!

Taking steps to improve your health would give you a much better quality of life both in the immediate and longer term, so that's definitely something worth doing.

LHW99

Why not try 10% for 6 months, and increase from there if it works for you?

HotDog2020

Marcon said:

HotDog2020 said:

Thanks @Marcon I know it is a lot, but if there is no state pension when I come to retirment age what am I going to live on? I work for a lovely company but tight on cash they pay only the bare minimum. 

Also I did have a role where I earnt I think 18kpa not that long ago for a short time, now I am on 28kpa, I know that I can live on both, I may not have the disposable and I will feel the pinch, but if I learn to live on less I may have a future. However you may be right and it is too restrictive however my mother has said a few times that if I was to have less wages there will be less to spend on food - I always live within my means. I have planned week to week money, I have have planned to eat healthier, I am starting a new plan on April 2nd, however the shopping arrives 29.03.24 so will start then. I am waffling. 

I just have been worried about having a future and I have been worried about my health at the same time - it might be that if I am saving into a pension I will want my health to be better otherwise there is no point. And I know a few seniors in my industry and they are not on the ball, most senior people do not work for a good reason. I don't want to end up without a pension and without a job. Also this is based on retiring at 70!

I think working on the premise that you'll retire at 70 and there'll be no state pension is probably a tad pessimistic - actually rather more than just a tad!

Taking steps to improve your health would give you a much better quality of life both in the immediate and longer term, so that's definitely something worth doing.

Do you really think it is pessimistic? I thought the governement stopping National insurance contributions meant an end to pension am I wrong? and they keep saying they want to scrap the pension, or am I just reading all the scaremongering media? How could it be that a continual reduction in National insurance mean that I get a pension in the future?

I am hoping you can tell me something I am missing?

Dazed_and_C0nfused

HotDog2020 said:

Marcon said:

HotDog2020 said:

Thanks @Marcon I know it is a lot, but if there is no state pension when I come to retirment age what am I going to live on? I work for a lovely company but tight on cash they pay only the bare minimum. 

Also I did have a role where I earnt I think 18kpa not that long ago for a short time, now I am on 28kpa, I know that I can live on both, I may not have the disposable and I will feel the pinch, but if I learn to live on less I may have a future. However you may be right and it is too restrictive however my mother has said a few times that if I was to have less wages there will be less to spend on food - I always live within my means. I have planned week to week money, I have have planned to eat healthier, I am starting a new plan on April 2nd, however the shopping arrives 29.03.24 so will start then. I am waffling. 

I just have been worried about having a future and I have been worried about my health at the same time - it might be that if I am saving into a pension I will want my health to be better otherwise there is no point. And I know a few seniors in my industry and they are not on the ball, most senior people do not work for a good reason. I don't want to end up without a pension and without a job. Also this is based on retiring at 70!

I think working on the premise that you'll retire at 70 and there'll be no state pension is probably a tad pessimistic - actually rather more than just a tad!

Taking steps to improve your health would give you a much better quality of life both in the immediate and longer term, so that's definitely something worth doing.

Do you really think it is pessimistic? I thought the governement stopping National insurance contributions meant an end to pension am I wrong? and they keep saying they want to scrap the pension, or am I just reading all the scaremongering media? How could it be that a continual reduction in National insurance mean that I get a pension in the future?

I am hoping you can tell me something I am missing?

Where have you read that?

Will you be voting for a party that proposes scrapping the State Pension?

You don't have to pay NI to accrue qualifying years for State Pension.

The Lower Earnings Level of £131/week is key to that and that could still be monitored even if the NI rate payable by employees was 0%.

NoMore

 I thought the governement stopping National insurance contributions meant an end to pension am I wrong? 

Yes, your wrong, even if they scrap NI, there is no intention to scrap the State pension, your entitlement will just be tracked in a different way, that's to be decided when (if) they remove NI.