How much do you live on in retirement?

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Re: How much do you live on in retirement?

Postby DasNutNock on Tue Sep 05, 2017 2:05 pm

warp wrote:if you worried about retirement when 18 you'd be an even more miserable **** now!


Not if I'd got myself on the NHS pension scheme, I wouldn't.
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Re: How much do you live on in retirement?

Postby Vince on Tue Sep 05, 2017 2:33 pm

I'm in my late 50's and have been doing the numbers and then re-working them for the last ten years or so.
Each year changes due to circumstances, kids at college, rising health costs, taking care of eldery parents etc.
When we sold our company 5 years ago, the OP question was first and foremost on my mind. I made a nice amount of money each year and had a comfortable living. When you are used to creature comforts you don't want to give them up after working your nads off for 40 years.
Originally intended to retire in a year or two, but have decided to help grow our families real estate business for another few years in order to not dip into our savings just yet. By then the mortgage will be paid off, all the kids will be out of college and we will be debt free.
I have a small pension coming in every month from the UK, I have a decent amount in a 401k(private pension) , some savings and a decent amount of equity in a couple of homes. Plus in 3 years time, I can also get a State pension of approx. $ 3k a month aswell if I want to start withdrawing early.
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Re: How much do you live on in retirement?

Postby Shy Ted on Tue Sep 05, 2017 3:29 pm

I am 66 years old, my state pension is £628 a month.
I live on a boat, so that makes me a soap dodger, and water gypsy.
There I've said it. :oops:
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Re: How much do you live on in retirement?

Postby mushy on Tue Sep 05, 2017 3:40 pm

DasNutNock wrote:Dont *have* to buy an annuity though, do you? Or have I misunderstood?


No you dont, and speaking personally I never would*
Annuities seem to me to be the biggest con of the lot, these companies are giving you 3% (ish) whilst making up to four times that amount by using your money, and if you drop dead within a couple of years they keep the lot (usually).
There are plenty of other reputable pensions you can invest in without having to put up with annuities.


*disclaimer. I am NOT a pensions advisor and so as far as the law goes I know nothing and my advice is worthless.
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Re: How much do you live on in retirement?

Postby mushy on Tue Sep 05, 2017 3:56 pm

delbert wrote:My various work pensions kick in when I'm 60 and my mortgage will have been paid off by then as well, I'm hoping a little stress free part time job will see me through to state retirement age........

How do you mean they kick in at 60?
You can by law take your company pension at any age from 55, they cannot (as far as I am aware), make you take them at 60.
A job at B&Q beckons.
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Re: How much do you live on in retirement?

Postby EvilC on Tue Sep 05, 2017 4:13 pm

sendô wrote:I think you might have missed the point that I was trying to make.

We're talking about pensions and if the public sector have it too good - should it not be a basic right in this country to expect a decent standard of pension upon retirement?

There's so many different types, state pension, private pensions, different companies offer different contribution percentages, for different people at different wages that may or may not have a bigger or smaller pot, or might get an annuity, or might take a lump out and so on.

Why not just have a system where we all pay into a government backed pension pot - a bit like a tax I guess, you could call it something catchy like National Insurance - and then at age 65 or 68 or 87 or whatever the **** we can all expect to draw from said pot.

Anything else you save yourself will be a bonus.


You have the right to what you can afford. You can expect what you want. 55% of final salary is very likely to be unaffordable and unsustainable. If your employer is stupid enough to give it to you then more power to you.

I'd love to see specific contributions go into a ring-fenced pot for state pensions for a basic amounts and then you can make your own arrangements for whatever else. Unfortunately that isn't politically acceptable as it will require some fiscal discipline from our politicians.
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Re: How much do you live on in retirement?

Postby Wembley1966 on Tue Sep 05, 2017 4:14 pm

devonshire flu wrote:My plan is to have a £100,000 tax free lump sum when I retire, plus about £18,000 per year.

To get the £100k tax free you'll need a pot of £400k - the £300k left would see you through 25 years of drawdown at £18k (not allowing for inflation) - 35 years and you'll need nearly £400,000 left - which is about what you'd need for an annuity that could last 1 year or 40 years! That's without the £8k a year from the state pension - so once you reach that age you can spend more or drawdown less.

Remember that pension income is taxable!

One of the advantages of drawdown is that if you die before you're 75, what's left in the pot goes tax free to your wife (or kids). After 75 they pay income tax on it.
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Re: How much do you live on in retirement?

Postby Johnny Byrne's Boots on Tue Sep 05, 2017 4:22 pm

Disclaimer. I am not a financial adviser, therefore my advice is worth every penny you paid for it.

There's more to an annuity than just "3 percent and they keep the capital when you check out". Depending on your personal circumstances you can choose various options, things like annual RPI increases, and a reduced pension for your nominated beneficiary (spouse/partner) to continue after you pop your clogs for instance. If your health is impaired you also get an increased payment.
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Re: How much do you live on in retirement?

Postby DasNutNock on Tue Sep 05, 2017 4:27 pm

I'm pretty certain that (like pensions, sadly) annuities are structured to benefit the provider WAY more than the policyholder.
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Re: How much do you live on in retirement?

Postby Mega Ron on Tue Sep 05, 2017 4:28 pm

...
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Re: How much do you live on in retirement?

Postby 3times on Tue Sep 05, 2017 5:04 pm

Public sector pensions are 80th schemes so it is unlikely you will get 55% + of your final salary.

If you do 40 years you will get 40/80ths of your final salary (50%) as an index linked pension. As far as I remember the tax free lump sum is 1.5 x final salary and any AVC's can be taken as a lump sum as well.

For those that have deferred (non public sector) DB schemes and want to move them from the current provider the transfer values at the moment are very high, some as much as 5 x what they were 3 or 4 years ago. This is because a lot of these schemes want rid of these liabilities (as a deferred pensioner that is what you are).
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Re: How much do you live on in retirement?

Postby mushy on Tue Sep 05, 2017 5:18 pm

Johnny Byrne's Boots wrote:Disclaimer. I am not a financial adviser, therefore my advice is worth every penny you paid for it.

There's more to an annuity than just "3 percent and they keep the capital when you check out". Depending on your personal circumstances you can choose various options, things like annual RPI increases, and a reduced pension for your nominated beneficiary (spouse/partner) to continue after you pop your clogs for instance. If your health is impaired you also get an increased payment.


You havent sold me on them yet JBB, naturally if you smoke 80 fags a day they will offer you more money, on the grounds that you are not likely to survive much past the next couple of Christmases.
Also you are correct, your spouse can get some of it after you depart, but this comes at a cost as well (a reduced percentage), I still havent seen any of these that I would term anywhere near reasonable yet.
I would have thought that if you had a pot of say 400K, you could yourself raise more then the 3% interest mentioned and pass whatever pot you have left onto your nearest and dearest. (see the Wembley drawdown option).
I may well be totally ignorant of these endowment type schemes but I have never seen any real benefit to any of them, am I missing something? If so, what?
.
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Re: How much do you live on in retirement?

Postby mumbles87 on Tue Sep 05, 2017 8:36 pm

I joined my company at 16, started in the pension at 18

I plan to go at 58 when I have max contributions ..

Final salary and I do 4% avc aswell to top it up so I can take a massive lump sum of up to 25% of the whole pot now and leave my actual pension full whack

Money wise providing my I have no mortgage (due to end at 62 now but taking 2 years off next time I remortgage) then I can prob live on half my wage

Wife has average salary now I believe so not as good as when she started but providing she gets something works for me

I'll leave at 58 she can go at 60 and I'll enjoy those 3 years between our retirements lol
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Re: How much do you live on in retirement?

Postby delbert on Wed Sep 06, 2017 1:24 am

mushy wrote:How do you mean they kick in at 60?
You can by law take your company pension at any age from 55, they cannot (as far as I am aware), make you take them at 60.
A job at B&Q beckons.


If I take them at 55 then they're reduced. The job I'm currently in kicks me out the door at 60 which ties in nicely with the other pensions.
I've just noticed the post by mumbles87, going by your previous posts I assume that's a LU/TfL pension? There's people on here that would explode in indignation at the total awesomeness of that pension scheme.... :D
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Re: How much do you live on in retirement?

Postby mumbles87 on Wed Sep 06, 2017 7:11 am

delbert wrote: I've just noticed the post by mumbles87, going by your previous posts I assume that's a LU/TfL pension? There's people on here that would explode in indignation at the total awesomeness of that pension scheme.... :D


your not wrong delbert (on either counts lol)

im under no illusions that the world will be so different by the time I retire so I doubt my plan of comfortable living at 58 will come into plan however thats why I have been doing AVCs for about 4 years now.. just build something to cover the shortfall if anything happens

I know a fair few people who have better pensions than me in the private sector but they were (now retired) either Bankers or ironically pension managers
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Re: How much do you live on in retirement?

Postby IronworksDave on Wed Sep 06, 2017 7:31 am

I'm retired living in the Far East ... great climate but decent 'live' football is only available on TV ... but we do get every game live so not all bad ....

Started a private pension back in '72 ... was planning to have the princely sum of 140k at age fifty .... obviously that soon turned out to be not enough so I paid in more and more as I could afford ....

In the end had a pot of just shy of 350k ... used the lump sum 42k to buy a house in 2008 ... three bed/bath and a swimming pool, near the beach, nice but not uber rich ....

Get an income (moved the fund to private investments) of 25k a year ... that's a fortune out here ... will probably run out of cash in 2051 (all depends on interest rates) ... but will run out of breath long before that ... lol ... anything left goes to my kids ...

Would that work in the UK? not a chance .... but I would 100% recommend moving to a cheaper Country ... and that includes most of 'em .....
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Re: How much do you live on in retirement?

Postby jastons on Wed Sep 06, 2017 10:17 am

I'm more concerned about being able to afford things in the short term rather than my standard of living in 35 - 40 years when I retire. And that's before I think about saving for a deposit to get a mortgage.

Is there any point in taking out a mortgage if it doesn't look likely it will be paid off before retirement?
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Re: How much do you live on in retirement?

Postby Wembley1966 on Wed Sep 06, 2017 10:30 am

^^^ There was no way I could afford to pay my mortgage off before retirement, so had interest-only ones. I've just used the lump sum from my pension to pay off most of the mortgage. The increase in the value of houses we've owned has always been far more than the interest payments. At some point we'll downsize to supplement the pension and help the kids out.
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Re: How much do you live on in retirement?

Postby mushy on Wed Sep 06, 2017 10:32 am

IronworksDave wrote:

Get an income (moved the fund to private investments) of 25k a year ... that's a fortune out here ... will probably run out of cash in 2051 (all depends on interest rates) ... but will run out of breath long before that ... lol ... anything left goes to my kids ...

....

Dave,
if its not a rude question what sort of return percentage wise(on average|) are you getting on your investments?

Mumbles,
You talk about a 25% tax free lump and in the next sentence you mention re-mortgaging, would it not be more efficient to take the money and pay off the mortgage thus saving quite a bit on interest rates?

Delbert,

Forcing you out the door at 60? Fairly unusual these days, is it an American company?
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Re: How much do you live on in retirement?

Postby Crouching Peeky on Wed Sep 06, 2017 10:56 am

I'm 38 and plan to retire between 55 and 58 circumstances dependant. I'm fortunate enough that I work for a firm that pays 20% into my pension which is pretty much as good a defined contribution scheme as I've seen. I've been here just over 6 years and I've built up a tidy pot size and I haven't put a penny in yet. Based on the online projections of the administrator, if I remain here and nothing changes to my contributions my pot will be worth north of £950k. Lots of ifs and buts make those numbers up but I definitely like the idea!

I've also got a few years of a final salary scheme that will pay me a few grand a year not to mention the state pension I can take at 68 means I should be quite comfortable in my old age which is all well and good because I haven't got a pot to p*ss in currently :lol:
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