There’s obviously some very well paid people on here, or should i say people who were earning well above minimum wage and have been able to save enough to retire well before state pension age. I would guess that isn’t an option for most people unfortunately, and the majority will be working at least till state pension age, and in many cases beyond - I’ll probably be one of them.
Probably... Its just that when you look at the figures of how much you lose for going pre retirement age (about 25%, I think), it makes me unsure of what I will need to be comfortable. Mortgage is paid off in 3 years so I think I will look to put £300 to £400 each month into AVCs for 10 years.
It’s all well and good saying it’s only this much extra a month to find but if you’re already struggling to make ends meet, struggling to pay the rent or mortgage, or haven’t enough to put the heating on or put food on the table every day, how on earth are you supposed to find this extra money to put in a pension every month ?
it is very difficult, but the issue is that the rent, heating and food requirements aren't going to disappear when you cease working.
Which is why lots of people will have no choice other than to continue working past retirement age
You don't find it. It goes into your pension before you receive it. That's the beauty of paying into a pension instead of saving what you have left over. If you try to do that you invariably spend it. 5% contribution on minimum wage is £53 a month of £1,635 take home or 3%. Is 3% of your income now going to make enough difference to your life that it is worth sacrificing 100% more than your state pension income when you retire? That is also why it is so heavily incentivised. You get twice as much as you put in, even if it doesn't grow. With growth you will get 6x what you contribute. There are not really any better investments.
Little tip stick in at school
Or start a business !
Not being funny but it sounds like you’ve never been in a position where you’ve really had to struggle to get by from day to day. I’ve been there got the T-shirt - through no fault of my own i lost everything when my first relationship broke down. I had to start from scratch again at 40 with a new mortgage, i was only able to do so because i received a small inheritance at the same time,along with my share of the equity in the house i shared with my ex. She got the four bed house which we paid £78500 for (it’s now worth £375000) my ex’s mum paid off the remainder of her mortgage, whilst i had to lash out £125000 on a pokey two up two down (it’s worth perhaps £140000 now), she got the car and all the house contents too. Along with starting a 24 year mortgage at 40 i also had to pay child maintenance for our three girls, which i don’t begrudge as they’re my responsibility too, but for about ten years i usually had more going out each month than i earnt. I wracked up a huge debt and i can assure you it wasn’t from living extravagantly, it was just from everyday expense's that i couldn’t avoid. I eventually paid back every penny of what i owed but it took me a long long time. I’m not bitter, i may not be rich financially but I’m rich in many other ways - I’m now married to a wonderful girl who definitely isn’t with me for my money
i have my three brilliant kids who are now grown up, and I’m reasonably healthy as far as i know, but when you say it isn’t money you have to find to put in a pension it’s still money you don’t receive from your wage, and believe me when you’re on the bones of your ass every penny counts. Sorry if this sounds like a rant, it really isn’t, and I’m not having a go at you, but things aren’t always as straightforward or easy to do as they seem for some people.
I can’t afford the monthly payment as it is, like alot of folk it rocketed this year thanks to Liz and kwasi.
It’s an all too familiar problem now for lots of people unfortunately - i feel for you, and i know what a strain it is when you’ve got bills coming left right an centre as well as a mortgage or rent to pay. Hang in there and eventually things will get a bit easier for you mate
Same here!
Another teacher?
Those who have retired or are about to may well have benefited from final salary schemes, at least in the earlier part of their careers. Makes a big difference.