How much extra should my partner contribute?

TrickyDicky

My Partner is lucky enough to get a 1/80th / year final salary pension without having to contribute anything, but she does have the option of contributing addition funds based on a fixed amount/month or a percent of her pay. On the MSE main website it recommends that you should invest a %age equivalent to half your age when you started contributing. The thing is, has anyone got a quick way of working out what a 1/80th pension may be worth in real or percent terms so we can work out how much extra it may be prudent to invest?

dunstonh

The thing is, has anyone got a quick way of working out what a 1/80th pension may be worth in real or percent terms so we can work out how much extra it may be prudent to invest?

That would be such a poor way to work out your pension shortfall.

The easiest and more accurate method is to work out in todays terms what the occ scheme will pay (that bit is easy). Then decide if its enough or not. If its not enough then decide how much more income is needed. Assuming a 5% income rate, work out the lump sum, then calculate that backwords to give you a monthly payment.

bigbloke45

Is she in a local governemnt or Civil Service type of pension? If so, her scheme may well be a 60ths scheme where tax free cash must be taken.

I would get a pension projection for her to see what shortfall there may be first. Then see if there is an AVC option etc.

Good luck.