How Am I Doing?

1813

Aylesbury_Duck said:

1813 said:

At the moment what I am doing is seeing how much the cost of living is where I live, which is £22512 per annum. At the moment I have around £18k built up in pensions that are index linked. I am building up my retirement plans based on future predictions but I know this is iffy as the future may not be as it is now, such as pensions still being index linked etc, will the lump sum still be here, for example. Thank you for all the advice. If I am being honest, I may need to consult an adviser but I think they will just say the outset isn’t great but we will see. I certainly wouldn’t be able to afford putting away massive amounts of money per month given what other outgoings will be. All my life I’ve done DB pensions. It’s just like many I don’t trust the government or systems to stay the same, such as index linking, for example, but that’s what we all paid into the DB pensions for in the first place.

Don't do that.  Your pension affairs are relatively straightforward and not yet sizeable.  You'll learn plenty from browsing here without the need to pay someone.  The trick with advisers of any sort is to know enough to know what to ask them, so learn as much as you can and if you still think you're lacking crucial knowledge or advice, consider paid advice.

As for not trusting the future, the same is true of DC pensions, investments and savings.  All you can do is work with the rules as they are and then deal with any changes that come along.  There's no point deliberately putting yourself into a weakened situation to insure against things that might never happen.  Are you confident that investments in a DC pension with inexorably rise over the next 25 years like many have in the last five?  I'm not!

Thanks - that’s what I am doing. I am updating my pensions by what I consider a good inflation rate. Doing that, I’d be fine but as you say, like you can’t rely on DC pits growing as you may like or foresee, the same can’t be said for the DB pensions and uprating as to me, that is vital and the loss of the state pension would be catastrophic, that or it being means tested. It’s hard to plan if the future is uncertain.

Aylesbury_Duck

1813 said:

Aylesbury_Duck said:

1813 said:

At the moment what I am doing is seeing how much the cost of living is where I live, which is £22512 per annum. At the moment I have around £18k built up in pensions that are index linked. I am building up my retirement plans based on future predictions but I know this is iffy as the future may not be as it is now, such as pensions still being index linked etc, will the lump sum still be here, for example. Thank you for all the advice. If I am being honest, I may need to consult an adviser but I think they will just say the outset isn’t great but we will see. I certainly wouldn’t be able to afford putting away massive amounts of money per month given what other outgoings will be. All my life I’ve done DB pensions. It’s just like many I don’t trust the government or systems to stay the same, such as index linking, for example, but that’s what we all paid into the DB pensions for in the first place.

Don't do that.  Your pension affairs are relatively straightforward and not yet sizeable.  You'll learn plenty from browsing here without the need to pay someone.  The trick with advisers of any sort is to know enough to know what to ask them, so learn as much as you can and if you still think you're lacking crucial knowledge or advice, consider paid advice.

As for not trusting the future, the same is true of DC pensions, investments and savings.  All you can do is work with the rules as they are and then deal with any changes that come along.  There's no point deliberately putting yourself into a weakened situation to insure against things that might never happen.  Are you confident that investments in a DC pension with inexorably rise over the next 25 years like many have in the last five?  I'm not!

Thanks - that’s what I am doing. I am updating my pensions by what I consider a good inflation rate. Doing that, I’d be fine but as you say, like you can’t rely on DC pits growing as you may like or foresee, the same can’t be said for the DB pensions and uprating as to me, that is vital and the loss of the state pension would be catastrophic, that or it being means tested. It’s hard to plan if the future is uncertain.

But the future is always uncertain.  Any changes to state pensions will be phased in with reasonable notice.  It won't happen overnight unless there's an event of such enormity that makes it essential, and then you'll be too busy fighting in the streets for a tin of beans to be worrying about your pension plans.

Personally, I can see a means-tested state pension coming at some point.  So what can I do about it?  As I see it, I have two options. Add to my personal pensions as much as I can so I am confident of a decent retirement income, or spend more now so in the event that state pension is means-tested, I won't "lose out" by having too much in personal pensions.

I know which I'm doing.  Never even considered the other.

crv1963

1813  I would work in todays figures, anticipating changes is not really beneficial either- they may or may not happen! So work within the current rules, adapt to any changes in the rules. If not you will tie yourself in knots. If you anticipate working until you have 35 years NI contributions I would work on getting full SP in your calculations.

cfw1994

crv1963 said:

1813  I would work in todays figures, anticipating changes is not really beneficial either- they may or may not happen! So work within the current rules, adapt to any changes in the rules. If not you will tie yourself in knots. If you anticipate working until you have 35 years NI contributions I would work on getting full SP in your calculations.

Makes most sense.
@1813 - you have years ahead of you.  The fact you are considering things now means you are doing very well.
Remember to enjoy life along the way to old age, that’s my best advice!!

1813

Thank you for the advice it is much appreciated.