Basic Pension planning... Panic!

Albermarle · 14 January 2020 at 4:25PM

My current fund estimates 4% return,

As said above, 4% after inflation is not bad and pretty normal by historical standards I think , although can be more, like in the past 10 years .
4% before inflation would be acceptable to most people nearing , or in retirement as they tend to derisk.
But at your age it would be on the low side and if this is the case then you might want to think about changing the fund in the pension.
One caveat to this is that the projected returns and future income that are given by pension providers are very pessimistic and it could be this 4% is effectively a worse case scenario.
Have another look at the paperwork so you are sure of the details and come back if you are not sure.

prezzacc · 14 January 2020 at 9:43PM

Thanks again for the advise and questions. To answer some more..

No other debts to pay other than mortgage. LTV has just hit 60%! Salary wise I don't see any major increases in the next few years, currently happy with where I am but of course this will likely change! I do recieve small pay rises annually which I usually saved straight away... This will now go towards pension.

Just found the last statement and it actually says they estimate 2.1% growth after inflation. So not great really. I need to look at another fund as I'm. Happy to increase risk for a good few years in return for potential higher returns.

Calcutors all seem to vary wildly so I need to find the right one, but by my calculations I want around 500k pot if I want 19k a year for 30 years?! So 15k current, 300 a month for the next 30 years, estimated growth 2.1%.. Certainly need to up these payments 😊!

I'm happy I'm at least looking into this now. Hopefully some more planning should get me closer to where I want to be!

Spreadsheetman · 14 January 2020 at 10:40PM

When planning for the future, don't assume you can keep a well-paid job into your late 50s and beyond. Quite a few people get made redundant in their 50s and getting a new job at the same salary level isn't always possible. (Or your health can take a downturn with a similar result.)

Marine_life · 14 January 2020 at 11:17PM

prezzacc wrote: »

Thanks again for the advise and questions. To answer some more..

No other debts to pay other than mortgage. LTV has just hit 60%! Salary wise I don't see any major increases in the next few years, currently happy with where I am but of course this will likely change! I do recieve small pay rises annually which I usually saved straight away... This will now go towards pension.

Just found the last statement and it actually says they estimate 2.1% growth after inflation. So not great really. I need to look at another fund as I'm. Happy to increase risk for a good few years in return for potential higher returns.

Calcutors all seem to vary wildly so I need to find the right one, but by my calculations I want around 500k pot if I want 19k a year for 30 years?! So 15k current, 300 a month for the next 30 years, estimated growth 2.1%.. Certainly need to up these payments 😊!

I'm happy I'm at least looking into this now. Hopefully some more planning should get me closer to where I want to be!

I wrote this a while ago:

http://earlyretirefree.com/could-you-retire-early-part-1-of-2/

I still haven't finished part two

Basic Pension planning... Panic!

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