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  • FIRST POST
    • AnxiousTheElephant
    • By AnxiousTheElephant 17th Nov 19, 5:37 PM
    • 52Posts
    • 41Thanks
    AnxiousTheElephant
    What % do you pay?
    • #1
    • 17th Nov 19, 5:37 PM
    What % do you pay? 17th Nov 19 at 5:37 PM
    Just wondering what % everyone pays into their work pension?

    My employer sets us up at 5% but I'm debating increasing this..
Page 3
    • Anonymous101
    • By Anonymous101 18th Nov 19, 3:53 PM
    • 1,476 Posts
    • 1,233 Thanks
    Anonymous101
    All these people contributing to SIPP's outside the works pension schemes have checked that they're not missing out on salary sacrifice first haven't they?
    • Bemma
    • By Bemma 18th Nov 19, 4:18 PM
    • 39 Posts
    • 25 Thanks
    Bemma
    4% me to get 8% employer contributions, additional 16% from me so 28% in total.

    All with Salary Sacrifice. My contributions attract 7% employer NI on top.

    This brings me down to <£50k, so out of 40% tax, 18% HICBC and mostly 12% NI (I have a bonus month that takes me into 40% tax, but most of my regular SalSac gets 12% NI relief).

    This will increase a lot in the run in to 55 by depleting savings etc. Currently 50.
    • JustAnotherSaver
    • By JustAnotherSaver 18th Nov 19, 4:23 PM
    • 4,430 Posts
    • 814 Thanks
    JustAnotherSaver
    All these people contributing to SIPP's outside the works pension schemes have checked that they're not missing out on salary sacrifice first haven't they?
    Originally posted by Anonymous101
    I can only speak for myself and not others but the answer is yes.


    Reading this thread I wonder how so many can afford to put away such high percentages each month. I know I couldnít afford that out of my pay.
    But then I suppose it confirms what Iíve long suspected - that the people on this board, or at least this section of the board, are not the sort of people who move in the same social circles as me, at least as far as earnings go. They earn considerably more, more than me, more than anyone I know (as in know, not know of). Therefore they can likely afford to put these kinds of figures aside because they still have a nice wedge left over anyway.

    If I put over 50% of £1600 Iím not paying my bills.
    Now if I earned 4-5k per month and put over 50% then thatís still quite a wedge to pay things with.
    • MaxiRobriguez
    • By MaxiRobriguez 18th Nov 19, 4:47 PM
    • 788 Posts
    • 650 Thanks
    MaxiRobriguez
    I can only speak for myself and not others but the answer is yes.


    Reading this thread I wonder how so many can afford to put away such high percentages each month. I know I couldnít afford that out of my pay.
    But then I suppose it confirms what Iíve long suspected - that the people on this board, or at least this section of the board, are not the sort of people who move in the same social circles as me, at least as far as earnings go. They earn considerably more, more than me, more than anyone I know (as in know, not know of). Therefore they can likely afford to put these kinds of figures aside because they still have a nice wedge left over anyway.

    If I put over 50% of £1600 Iím not paying my bills.
    Now if I earned 4-5k per month and put over 50% then thatís still quite a wedge to pay things with.
    Originally posted by JustAnotherSaver
    Not only is it easier to sacrifice higher %'s the higher up the earnings ladder you go, it also makes more sense to sacrifice more as you're avoiding more tax.
    • Anonymous101
    • By Anonymous101 18th Nov 19, 4:55 PM
    • 1,476 Posts
    • 1,233 Thanks
    Anonymous101
    I can only speak for myself and not others but the answer is yes.


    Reading this thread I wonder how so many can afford to put away such high percentages each month. I know I couldnít afford that out of my pay.
    But then I suppose it confirms what Iíve long suspected - that the people on this board, or at least this section of the board, are not the sort of people who move in the same social circles as me, at least as far as earnings go. They earn considerably more, more than me, more than anyone I know (as in know, not know of). Therefore they can likely afford to put these kinds of figures aside because they still have a nice wedge left over anyway.

    If I put over 50% of £1600 Iím not paying my bills.
    Now if I earned 4-5k per month and put over 50% then thatís still quite a wedge to pay things with.
    Originally posted by JustAnotherSaver


    I agree in a sense. I think that most on here probably earn more than average and possibly came looking on here as a way to learn where to put any excess. I also think that there's plenty who naturally enjoy a lower cost lifestyle which enables them to save more. Then there's the ones that are nearing retirement and maybe have a bit spare after kids have flown the nest. Basically lots of circumstances.


    I absolutely agree on the income front though. Its simply not possible for everyone to save large percentages of their salary. Those on lower wages can only afford to save so much after the basic needs are met. There's no getting away from certain costs. I also find, and i'm not suggesting that you're in this bracket, that people get used to spending a certain amount and its not possible for them to spend less. Also they won't think it possible that those that spend less are enjoying life as much. Looking at a lot of the threads on here you see spending ranging from £15k pa to £50k pa with little correlation to happiness.
    • MallyGirl
    • By MallyGirl 18th Nov 19, 4:59 PM
    • 4,133 Posts
    • 9,595 Thanks
    MallyGirl
    For myself, I do put a very high percentage of my salary in to get the max £40k into my pension. This is because I started late - I only used to put enough in to get the max from my employer. If I had gone over this at an earlier point in my career then I wouldn't be in catchup now.
    I sal sac down into basic rate pay and am lucky that my husband earns a bit more than me so we can afford to do this. Our mortgage is also currently rising not falling to help fund this. He also does a significant sal sac but his employer gives him all the employer NI too so it hits his take home less - they also allow him to sal sac bonuses where mine doesn't.
    The earlier you can contribute any extra, the more benefit it will buy in later life.
    • arthurdick
    • By arthurdick 18th Nov 19, 5:08 PM
    • 3,422 Posts
    • 8,354 Thanks
    arthurdick
    I am a very late starter with any sort of pension, didn't enter into any pension until the age of 48, various reasons why, including two massive amounts of time too sick to work because of serious accidents. Also, if that aint bad enough I am just above minimum wage, so even harder to catch up.

    For the last almost 12 yrs I have been in a LGPS DB pension, i pay 5.8% and my employer pays roughly around 2.5 times that, I know it is not enough but better to have a little of something than a lot of nothing. I also pay £300 p/m into AVC's.

    The only good thing that I can see, is that my take home pay is just below £1000, so by the time I get the state pension(fully qualified last year, I only needed 2 more years to contribute from 2016), it will be not be much less than I pick up now, plus my LGPS pension, I will be taking home slightly more money than when working,

    The problem I have now is when to go, 5 years early, 4 years early or 3 years early? I would go right now if it wasn't for the mortgage. The later I leave it the more AVC amount I will have and it falls below the 25% of 20 times yearly pension plus tiny lump sum.
    4371/3 =1457.. some people won't accept that though.
    Corduroy pillows are making headlines!
    • blues
    • By blues 18th Nov 19, 6:15 PM
    • 226 Posts
    • 718 Thanks
    blues
    Me: 8.5%
    Employer: 17%

    Public Sector
    • comeandgo
    • By comeandgo 18th Nov 19, 6:20 PM
    • 2,894 Posts
    • 4,006 Thanks
    comeandgo
    Me 50% employer 9%. I can afford 50% as no debts and mortgage paid off and will retire at 60 .
    • Notfarfromtheborder
    • By Notfarfromtheborder 18th Nov 19, 7:32 PM
    • 129 Posts
    • 167 Thanks
    Notfarfromtheborder
    me, 40% via ss, employer 11%. I also get 13.8% back from employer for NI savings on my contribution. Keeps me in basic rate territory.
    • Novice investor101
    • By Novice investor101 18th Nov 19, 7:59 PM
    • 567 Posts
    • 1,741 Thanks
    Novice investor101
    For what it's worth, I fall into the bracket of low earner - £23k a year & about a £1.5k bonus a year before tax (which I sacrifice into my pension - why pay all that tax/NI/student loan?).
    I manage to invest over £1000 a month by maxing out all the free money I can get via the matched pension, tax relief, LISA bonus & free work shares etc.
    My spreadsheet tells me I invest £1023 a month, I only contribute about £540 of that £1023 a month out of my own pocket.
    I'm lucky that I live alone, with low expenses, I'm not a materialistic person & I have a generous employer.
    • foofi22
    • By foofi22 18th Nov 19, 9:06 PM
    • 2,043 Posts
    • 1,332 Thanks
    foofi22
    14% from me and 6% from employer. I aim to achieve 20% minimum and will increase when my student loan is paid off
    • JustAnotherSaver
    • By JustAnotherSaver 18th Nov 19, 9:33 PM
    • 4,430 Posts
    • 814 Thanks
    JustAnotherSaver
    I'm not sure the logic of you paying the minimum because your employer pays the minimum stacks up! What your employer pays is not in your gift (unless you change employers). What you put in is. The advantage of pension saving is the tax relief you get as you pay money in. As a start, find out how much your employer would allow you to pay in. The good news is you are thinking about the contribution question at an earlyish age. Finger in the air, you need to be putting 15% - 18% into your pension each month, between you and your employer. Your future self will thank you. Good luck.
    Originally posted by k6chris
    I'd gotten to work after you posted so decided to respond tonight instead.


    I'm wondering if you only skim read my post and missed out the bit where i said i also pay in to a SIPP (usually approx 2.5 times what goes in to my workplace pension btw)?


    I know that the tax relief on the way in is an advantage but after a recent thread i made here it seems a L-ISA is more suitable for me rather than a pension.

    "But higher rate.......". Yeah i hear that a lot. Unlike some though (seemingly most people here), i'm just a mere mortal & not a higher rate tax payer, not even close.



    My employer will let me pay in whatever i can up to the maximum that i can ... it wont change what they put in one bit.
    I don't put above the minimum in because 1) they wont match it and 2) the pension pot is no doubt invested very conservatively (probably they don't want to get bad press off this government push) and since i was early 30s when it started, mid 30s now, i don't think very conservatively suits my situation.



    So what i would've paid in above and beyond .... currently goes in to the SIPP.

    So while i'm not paying in extra, i actually am.
    • JustAnotherSaver
    • By JustAnotherSaver 18th Nov 19, 9:43 PM
    • 4,430 Posts
    • 814 Thanks
    JustAnotherSaver
    I agree in a sense. I think that most on here probably earn more than average and possibly came looking on here as a way to learn where to put any excess. I also think that there's plenty who naturally enjoy a lower cost lifestyle which enables them to save more. Then there's the ones that are nearing retirement and maybe have a bit spare after kids have flown the nest. Basically lots of circumstances.
    Originally posted by Anonymous101
    I agree with your entire post. The bit about getting used to spending is very true. That's why when i get any pay rise, i always bump my contributions to something i'm saving for (emergency fund, retirement for e.g.).


    The bit i quoted too - yes, we will have many different circumstances on here, even people on low wages as there will be no one-size-fits-all statement that applies across the board.

    Still with that said, i think the majority will be people who either earn cash or have cash and have an interest in cash. By that i mean what i would refer to as a 'nice amount'.



    I only really know people who either struggle to get by or manage their money a little better and take a while saving to afford something. I don't know these people who earn or have the kind of money that seems to be getting mentioned here so while it interests me as i wonder how life is for different people in different situations, it's not really something i can relate to.








    To not totally waffle on, i do wonder when people calculate what goes in to their pension when they're talking about it, do they include their employers contribution or only their own?
    Me personally i only focus on what i do myself. My own contributions. I don't rely on there being a state pension at retirement, i rely on myself. So when i'm talking about my contributions i'd actually say i put in 5%, whereas it's a combined 8% that goes in.
    Last edited by JustAnotherSaver; 18-11-2019 at 9:47 PM.
    • Mordko
    • By Mordko 18th Nov 19, 10:03 PM
    • 886 Posts
    • 658 Thanks
    Mordko
    Reading this thread I wonder how so many can afford to put away such high percentages each month. I know I couldn’t afford that out of my pay.
    This a retirement site. Most are older than you. Also, most are human. And humans like to brag. Really wouldn’t try to assume what people post here is in any way representative.

    When I was in my 30s, I focused on career and family. The pay jumped around age 35 but was moderate up to that point. Started quite low when I was 25. There was a monthly pension contribution, same as for everyone else in my company. The DC funds I had were mirroring the world cap and looked at once a year at most. Worked out fine.

    Prioritising retirement planning and putting all the money into pension usually starts in late 40s or 50s, when the kids are standing on their own two feet. Certainly wouldn’t stress that crazies like me put such a high proportion into investments.
    • thickasabrick
    • By thickasabrick 18th Nov 19, 10:22 PM
    • 111 Posts
    • 83 Thanks
    thickasabrick
    What % do you pay?
    You are probably better working backwards from a target pot. Start with this Which article ďHow much do I need to save into a pension at different ages?Ē

    Then use a combination of pension and ISA contributions to achieve the target savings rate in a tax efficient manner.

    For me 10% in my 20s, 15% in my 30s and 40s. Have recently upped it above 20% now Iím in my fifties and aiming for early flexi retirement at 55.

    One useful thing I came across recently was the ďmillionaire next doorĒ formula were you use your ďnet worthĒ to estimate if you are accumulating assets at a reasonable rate. It will give you a figure based on your age and income. Much more useful than just looking at your pension pot in isolation.

    Just wondering what % everyone pays into their work pension?

    My employer sets us up at 5% but I'm debating increasing this..
    Originally posted by AnxiousTheElephant
    • JohnnyJet
    • By JohnnyJet 19th Nov 19, 7:12 AM
    • 293 Posts
    • 453 Thanks
    JohnnyJet
    I'm another one who doesn't earn enough to pay higher rate tax, and probably never will. I just concentrate on my situation and my targets as what others earn and do is interesting but not really relevant.

    A quick question, do people use net or gross contributions when stating how much they put into pensions?
    • adonis10
    • By adonis10 19th Nov 19, 8:33 AM
    • 1,690 Posts
    • 234 Thanks
    adonis10
    Interesting thread which makes me wonder how i compare to others here in terms of pension pot built to date. I posted a similar topic a while ago but always interesting to get other views as I am a late starter and feel my pension provision is so, so low compared to where it needs to be.
    Current status and valuations
    Age - 36
    Workplace pension £42k
    LISA £10k
    £37k cash (don’t really count this for retirement as will no doubt be eaten into for house bills, renovations, usual life costs)
    Salary - low-average bracket of £34k
    I’m currently upping my contribution as much as I can as am playing catch up due to a late start in the pension game. Fairly low mortgage means I’m able to put 18% away and hope to increase this to 25% over the next year.
    • JoeCrystal
    • By JoeCrystal 19th Nov 19, 9:12 AM
    • 2,097 Posts
    • 1,506 Thanks
    JoeCrystal
    One always feels that one's pension provision is too low! I have to admit that you are actually doing better than you might expect.

    The median private pension wealth for all people aged 35 to 44 is £12,400 few years ago. If you just include the people who do have private pension wealth then it goes up to £40,100.

    In my case, I am 33 on £28k salary with £70k in my personal pension and £7k in my workplace pension. Outside that though, I don't really have much cash or investment overall.
    • Notfarfromtheborder
    • By Notfarfromtheborder 19th Nov 19, 10:02 AM
    • 129 Posts
    • 167 Thanks
    Notfarfromtheborder
    I'm another one who doesn't earn enough to pay higher rate tax, and probably never will. I just concentrate on my situation and my targets as what others earn and do is interesting but not really relevant.

    A quick question, do people use net or gross contributions when stating how much they put into pensions?
    Originally posted by JohnnyJet


    I used gross % as my scheme is sal sac, as such it is deducted from gross
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