dojj

iTrader: (3)

i stick about £90 a month away but, according to some of the stuff i've been reading, i'll need to be staching away about 3 tiems as much in order to be able to retire on a decent sum

so, experts onions please

Chip

iTrader: (3)

Depends on how long you have been sticking it away for, pension payments made early in life result in a lot more funds at retirement time than the same payments towards the end, simply becase of the amount of time they have been maturing for.

For example, I started my pension off at 25 years old by paying 500 a month in for the first couple of years, to get a decent sum of money in there that still had 40 years to grow, that should have a lot more of an effect than doing so towards the end of the term.


what age did you start paying that in at?


The big problem with pension funds in general these days from what I gather, is that they just arent performing the way they used to, but im not a pension fund expert, I just know a bit about how the maths works.

dojj

iTrader: (3)

i've been paying in for about 3 years now so the "pot" should be around the 3 and a bit grand mark (it's got pushed up a bit as the wages have gone up) but is this better to keep going for the next 20 odd years and leave it at that or should i start to lump more away?

as mentioned in other posts, i've already got a second house fully paid off which is worth around the £340k mark and the thick end of about £200k in the bank plus this house which i'm currently paying the mortgage on which is again, worth around the £340k mark so i'm not doing to badly in that front

but the tax man is going to fuck me sensless if i were to sell one of the properties so short of giving it away to my kids to squabble over later in live and continuing to live in the other, what other options are there?

or am i fine as it is and worrying about nothing?

dojj

iTrader: (3)

forgot to sa been paying it in since i was 32, am nearly 35 now so if i retire as normal at around the 60's mark i've got another 25 years left in me to keep forking out

Markb_s1

i know mine's a total waste of time.. my work pay 10% of my salary into it every month.. might as well have just put it in the bank for the amount it's gone up in value.

dojj

iTrader: (3)

i'm stopped at 3%, but the company puts in another 3% plus there is some sort of tax business going on as well, but it's soemthings like £86 or £89 a month deducuted before tax from my wages

Iain Mac

I read a thing called The Miracle of Compounding Interest, described by Albert einstein as "the greatest mathematical discovery of all time" and one of the things that stuck with me was:

The earlier you start investing, the more time you leave for the miracle of compound interest to take effect. Someone who invests £100 a month from age 20 to 29 and then lets their investments grow is likely to have more money at 60 than someone who invests £100 a month from age 30 to 59.

So by saving the same amount each month for one third of the time, you can end up with more money just because you did your saving earlier.

Of course, pensions don't rely simply on interest. If they did, they wouldn't need all those terrbly clever chaps to run them. They play the markets and when they do well they get enormous bonuses, and policyholders MIGHT get some of the leftovers at the end of the term. If they lose, our costs for the pensions go up and they get smaller bonuses so have to buy cheaper Porsches and Ferraris.

Yes, I am cynical about the industry and have been ever since my bank put their "Management Fees" up - after their "management leaving me worse off in 7 years than I would have been simply by sticking the cash under the mattress!

dojj

iTrader: (3)

the problem was that i was never in a stable enough job until about a few years ago where i could put money into a pension

but if i had bee able to i would hae stck a few qud in earlyier as you can change jobs and still keep the same pension pot yes?

Chip

iTrader: (3)

TBH mate, you would be better off taking your 200K and buying another house with it, so you have 2 to rent out, put all the rent into buying another property, and keep doing that until you get to about 5 houses at retirement age, thats the ultimate in index linked pensions IMHO, just live off the rental income from them all, then when you die, your kids actually still have the ENTIRE "lump sum" of your "pension", as opposed to getting nothing from a pension company if you drop dead.

Iain Mac

Apart from the huge chunk taken by the Government as Inheritance Tax.
Told you I was cynical, but I actually agree with the idea of owning property you can derive an income from.

In my case, the plan will be to sell the family home, move to something smaller and live off the released equity.

sbd16v

i dont know much about pensions apart from i am retiring at 40 and my pension is very good LOL

Nick D

It all depends on cirumstances as well depending on how much money you'll need to live on and what age your going to retire etc.

I've put £7000 a year away (£580 a month) and will continue to do so until i've paid in for 40years, at 7% including compund this will be worth 860k after the 40 year term (estimated). However my main pension will be my property rental(s) income or possibly sell them when it gets to much hassle.

dojj

iTrader: (3)

if i could afford to put that sort of money away i'd not have a problem, but i don't

as for the second house, my folks live in the paid one and i live in the mortgaged one

all this talk about how much you can earn and what you can spend it on has confused me a fair bit in the other thread so that's what got the pensin thing going

is there any way i could carry on with the pension scheme i've got and create a secondary pension?

or could i put more money into the current one?

the basic figures i can find are that approx £500k in the pot = £31k a year income, the rate i'm going i'll get about £1300 a year

Rod-Tarry

Unless you are in a Final Salary scheme pension pots are a bit of a joke.

The examples are for a £133000 pot with a 33k lump sum paid.
Ive highlighted a pension with a 3% increase gauranteed for life for Single & a Joint
A Joint pension with 50% on death to spouse will pay £ 3804 per year if you retire at 50 or £4872 at 65.
YOU WOULD NEED A PENSION POT OF £657000 TO GET A 25K PENSION WITHOUT TAKING INTO ACCOUNT INFLATION OVER THE NEXT 30 YEARS.


The following shows standard pension annuity rates or try; With Profits annuity for the highest income possible;impaired life annuity if you are a smoker or suffer an illness;
purchased life annuity if you have a lump sum.

The annuities rates table is only a guide as rates change frequently. Please request a free annuity quote for an accurate income for you.


SINGLE LIFE - standard

Fund size: £100,000 (after taking £33,333 tax free cash)

The following pension annuity rates table shows the best open market option income for a compulsory purchase annuity. The original pension fund is £133,333 and after the tax free lump sum has been taken, £100,000 is used to purchase an annuity.

The annuity is paid monthly in arrears and compared on a level annuity, 3% escalation, and level with 10-year guarantee basis for single males and females from the ages of 50 to 74 years. No medical enhancements are included in these rates.

Last updated: 21 January 2008


standard - level annuity

male 50 £5,736
male 55 £6,120
male 60 £6,648
male 65 £7,392
male 70 £8,604
male 74 £9,972
female 50 £5,676
female 55 £5,940
female 60 £6,312
female 65 £6,936
female 70 £7,824
female 74 £8,904

standard - level annuity, 10-year guarantee

male 50 £5,772
male 55 £6,084
male 60 £6,588
male 65 £7,236
male 70 £8,100
male 74 £8,976
female 50 £5,652
female 55 £5,904
female 60 £6,276
female 65 £6,852
female 70 £7,620
female 74 £8,400

standard - 3% escalation

male 50 £3,696
male 55 £4,116
male 60 £4,680
male 65 £5,448
male 70 £6,600
male 74 £7,908
female 50 £3,504
female 55 £3,864
female 60 £4,344
female 65 £4,992
female 70 £5,892
female 74 £6,972


JOINT LIFE - standard

Fund size: £100,000 (after taking £33,333 tax free cash)

The following pension annuity rates table shows the best open market option income for a compulsory purchase annuity. The original pension fund is £133,333 and after the tax free lump sum has been taken, £100,000 is used to purchase an annuity.

The annuity is paid monthly in arrears and compared on a level annuity with 50% spouse benefit on death, level with 100% spouse and 3% escalation with 50% spouse basis. No medical enhancements are included in these rates.

Last updated: 21 January 2008

standard - level annuity, 50% spouse

male 50 and female 50 £5,568
male 55 and female 55 £5,808
male 60 and female 60 £6,228
male 65 and female 65 £6,804
male 70 and female 70 £7,620
male 74 and female 74 £8,568

standard - level annuity, 100% spouse

male 50 and female 50 £5,400
male 55 and female 55 £5,532
male 60 and female 60 £5,856
male 65 and female 65 £6,312
male 70 and female 70 £6,960
male 74 and female 74 £7,632

standard - 3% escalation, 50% spouse

male 50 and female 50 £3,444
male 55 and female 55 £3,804
male 60 and female 60 £4,260
male 65 and female 65 £4,872
male 70 and female 70 £5,724
male 74 and female 74 £6,636

dojj

iTrader: (3)

that's made some intresting reading rod, looks like i'll have to tell the kids to pay for the extension and flog the other house when my folks croak

Chip

iTrader: (3)

Rods figures highlight what I was saying, you can get a return from renting a house of 5% anyway, and you still have the house, with a pension all you are getting really is the interest on the money you have, but NOT the money itself.

ECU Monitor Enthusiast

iTrader: (1)

Pensions are a waste of time IMO.

Especially for me with all the internet death threats I have received this week

Andy_R

iTrader: (3)

Annuity rates havent changed that much over the past 15years.
I can remember manualy working out income based annuity rates back in the day, before decent technoligy was introduced.
Rough rule of thumb per £100k on a male (based on a flat annuity no guarantee etc)
£7500 @ 65.
dropping £750ish for 5 years less:-
£6750 @ 60.
dropping a further £500ish off for 5 years less:-
£6250 @ 55

joel_winders

neilm

Put all your money into life insurance..... that way, if Phil manages to build a Flash Gordon style Death Ray that can kill you without leaving his house at least your debts to all your outstanding customers will be paid...

ECU Monitor Enthusiast

iTrader: (1)

neilm,
I dont have any outstanding customers

Keep living in the past

cossie4i+

iTrader: (15)

I pay in £291.40 every 4 weeks.

Steve.

dvid

I apy £140 something, employer matches it and I get tax relief...

All in all just over £300 a month