Would you rather have a good salary, or a solid gold pension?

jakewalsh

Active Member
Big wage for me, not that i have one,

my mum died aged 49, didnt get to spend or enjoy anything she saved for.

My motto i came with nowt im going with nowt.

Im certainly not paying £800 a week in nursing home fees

Since she passed that tought me that today is the rainiy day,

While im not stupid with money, if i want something and can afford it i will go for it.

I look at my house as a pension
 

reiteration

Member
Seems you only need £11k / year to retire on……


Seems much too low to me.

there's a difference between need and want... if your mortgage is paid off, and no debts then I'm guessing the average person can survive?

i know a single guy in carlisle... simple lifestyle goes abroad from time to time (and when his daughter lived in london - she's in latvia now) he'd get the train and do childminding duties during the week... he worked for the council forever, and his pension is round 15k...
 
Last edited:
D

Deleted member 27989

Guest
there's a difference between need and want... if your mortgage is paid off, and no debts then I'm guessing the average person can survive?

i know a single guy in carlisle... simple lifestyle goes abroad from time to time (and when his daughter lived in london (she's in latvia now) he'd get the train and do childminding duties during the week... he worked for the council forever, and his pension is round 15k...
Exactly the assumptions are to have paid off the house by then, have no debts etc. Which to be honest is entirely possible when staying within 3x multiples and just a normal 25yr repayment mortgage. Children living their own lives with good jobs etc.

I think the problem is that many haven’t done that and overstretched themselves with 40 year mortgages, cars on finance and everything else.
 

jakewalsh

Active Member
So, when your 68, you sell your house and use that to top up your state pension?

Pretty much, if i make it that far.

If not it will set the kids up for their future. Way this country is going there will be no state pension, and they will tax ypu 50% when you die.
 

jakewalsh

Active Member
Exactly the assumptions are to have paid off the house by then, have no debts etc. Which to be honest is entirely possible when staying within 3x multiples and just a normal 25yr repayment mortgage. Children living their own lives with good jobs etc.

I think the problem is that many haven’t done that and overstretched themselves with 40 year mortgages, cars on finance and everything else.
Everything seems to be on tick now, cars, phones,. You own nothing by the end of it, while i dont have a big wage, when we bought our first house we took 35yrs, ive always over paid the mortgage, after 12yr we only had 13yrs left.

We used that equity to move to a biggee 3 bed, which should be our forever home
 

hippo99

Distinguished Member
Pretty much, if i make it that far.

If not it will set the kids up for their future. Way this country is going there will be no state pension, and they will tax ypu 50% when you die.
So if you sell the house, you’ll start renting or downsize?
How much £ will you be left with after downsizing?
 

jakewalsh

Active Member
Dunno tbf

Who can predict the housing market in the future

Ive seen my current house go from £140k to 220k in the space of 18months🤷

So if you go middle of the rd we'd have at least 180k to down size or rent, could torture the kids and make one of them have a granny flat 😂
 

hippo99

Distinguished Member
Dunno tbf

Who can predict the housing market in the future

Ive seen my current house go from £140k to 220k in the space of 18months🤷

So if you go middle of the rd we'd have at least 180k to down size or rent, could torture the kids and make one of them have a granny flat 😂
How much does a suitably downsized property cost in your area? My point being what you’ll have left over isn’t really going to be that much of a ‘top up’ to your pension.
 

Xenomorph

Member
Pretty much, if i make it that far.

If not it will set the kids up for their future. Way this country is going there will be no state pension, and they will tax ypu 50% when you die.

If there's no state pension then people are really screwed. Because as you rightly say, many are in debt up to the eyeballs, and aren't stacking away enough into their pension.
 

jakewalsh

Active Member
I saw a 3 bed semi street above mine £1300 pcm rent.

How can they save. Cost of living atm is out of control

I know we cut pur cloth accordingly etc, ive just had the latest money saving expert email, house and home ins to rise.

Really sticking the boot in atm
 

reiteration

Member
yeah, got a younger colleague who went to uni (and the goverment want to lower the threshold of when it's paid back too!), and he was saying the other year that - his salary goes past HMRC (real time) and his student loan is deducted from that, but we got a bonus, and it went through the same process, and he paid more of his student loan (which seems is just another tax) - so there's no incentive for him to do well, as any bonus's etc just goes back into paying his loan?
 
D

Deleted member 27989

Guest
yeah, got a younger colleague who went to uni (and the goverment want to lower the threshold of when it's paid back too!), and he was saying the other year that - his salary goes past HMRC (real time) and his student loan is deducted from that, but we got a bonus, and it went through the same process, and he paid more of his student loan (which seems is just another tax) - so there's no incentive for him to do well, as any bonus's etc just goes back into paying his loan?
Of-course there is an incentive to do well, it just comes with consequences due to his personal situation. For me it would drive me to do even better, take control and get myself out of that situation...
 

The Dreamer

Distinguished Member
Of-course there is an incentive to do well, it just comes with consequences due to his personal situation. For me it would drive me to do even better, take control and get myself out of that situation...
Yes. At least there is an end point with a student loan, so it does pay to push through and get rid of it.

When you get to the higher levels of tax though, past the 40%, and into the 60+%, there is little incentive to keep going, as just after you clear the 60+% band, you move into the 45% bracket, and there’s no relief from that.

One of the drivers for me going part-time; it just wasn’t worth the effort of spending more time at work, just to give it to the tax man!
 
D

Deleted member 27989

Guest
Yes. At least there is an end point with a student loan, so it does pay to push through and get rid of it.

When you get to the higher levels of tax though, past the 40%, and into the 60+%, there is little incentive to keep going, as just after you clear the 60+% band, you move into the 45% bracket, and there’s no relief from that.

One of the drivers for me going part-time; it just wasn’t worth the effort of spending more time at work, just to give it to the tax man!
Agreed, and that is a big problem in taxation systems around the world. Too often it pays to not be doing well as the system is punative, and then you really need to be able to clear those thresholds by a significant margin for it to be worthwhile again. We’ve been a single household income family for a long time, and I think it’s silly that you can end up being worse off compared to having two smaller incomes but the same total net income. To us it was still worth it though.
 

jole26

Well-known Member
I'm over 55 and looking at 60 to retire in a few years. I've managed to build a good DC pension pot. Mortgage paid off, no kids and no debts. A good amount of savings/investments too. I don't earn loads but my salary is above average.

I took redundancy last year due to Covid and decided to have a year off to see what retirement was like (I didn't actually touch my pension or savings as we can live on what my wife earns, even though she earns quite a bit less than me). I'm back working now as decided I didn't want to retire until we both can.

I think I've managed to balance enjoying life while working and also saving enough for a good retirement. I certainly don't feel I've gone without in order to be comfortable in retirement.
 
D

Deleted member 27989

Guest
I'm over 55 and looking at 60 to retire in a few years. I've managed to build a good DC pension pot. Mortgage paid off, no kids and no debts. A good amount of savings/investments too. I don't earn loads but my salary is above average.

I took redundancy last year due to Covid and decided to have a year off to see what retirement was like (I didn't actually touch my pension or savings as we can live on what my wife earns, even though she earns quite a bit less than me). I'm back working now as decided I didn't want to retire until we both can.

I think I've managed to balance enjoying life while working and also saving enough for a good retirement. I certainly don't feel I've gone without in order to be comfortable in retirement.
Similar for me. I was “semi retired”, I say semi as I don’t think I can fully stop. Was just on several advisory boards, and did day trading as well for a couple of hours. Didn’t really need to touch any of the longer day pots. But as my children go to school and college, and then covid kicked in, I actually went back to full time when one of the companies asked me for the fourth time to go full time. At times I regret going back to full time work, I did like having the time available. But it was a good exercise, with a mortgage gone and no other debts I don’t need that much actually.
 

Davidc7230

Active Member
I started paying into my first pension as a teenager, my first boss said look around you there are guys here in their 60's-70's whose bodies can't hold up a full-time job but they cannot afford to retire, you can be like that go through life with nothing to show for 40+ years of grafting or you can put as much away now as you can afford and retire early like me (he went on to retire at like 50 something). He had put enough away to give up work, (came back part-time for the share-save scheme) pay for both his kid's weddings and give them house deposits as wedding gifts.

It does haunt me a bit, to be of an age where I physically cannot work anymore but I cannot afford to retire either. My Dad died at 60 and left my mum nearly £200k in pensions, life assurance and obviously the house.

That being said to answer the OP question, I just left a job at Thames Water that combined was paying 15% of my wages in each month to take a higher paying job at Morrisons makes a mockery of me wanting to save for an easier life in retirement.
 

Xenomorph

Member
I started paying into my first pension as a teenager, my first boss said look around you there are guys here in their 60's-70's whose bodies can't hold up a full-time job but they cannot afford to retire, you can be like that go through life with nothing to show for 40+ years of grafting or you can put as much away now as you can afford and retire early like me (he went on to retire at like 50 something). He had put enough away to give up work, (came back part-time for the share-save scheme) pay for both his kid's weddings and give them house deposits as wedding gifts.

Sound advice.

It does haunt me a bit, to be of an age where I physically cannot work anymore but I cannot afford to retire either. My Dad died at 60 and left my mum nearly £200k in pensions, life assurance and obviously the house.

That being said to answer the OP question, I just left a job at Thames Water that combined was paying 15% of my wages in each month to take a higher paying job at Morrisons makes a mockery of me wanting to save for an easier life in retirement.

15% is a very good contribution level. Although it depends what your salary is. What's the Morrison's pension contribution like? If you got a higher salary, with fairly good pension contribution, you're on to a winner. I doubt you would be able to match 15% though.
 

Davidc7230

Active Member
Sound advice.



15% is a very good contribution level. Although it depends what your salary is. What's the Morrison's pension contribution like? If you got a higher salary, with fairly good pension contribution, you're on to a winner. I doubt you would be able to match 15% though.

The salary is a £7k plus on what I was making before but not sure about the contributions I think they match what you put it in up to I want to say 8% I have my induction tomorrow, so I guess I'll find out for sure then.

I am finding as I have just hit my early 30's that planning for my retirement is taking up more brain space although bar coming into a massive sum of money the idea of retiring early is out of reach currently.
 

Xenomorph

Member
If you want to retire early, it probably boils down to how you bridge the gap to your state pension becoming available, which is what people rely on as a main component of their retirement income. This is assuming you will have the full 35 years NI contributions.
My job these days is considering various scenarios for retirement date, and modelling how the pension assets will burn down.
 

The latest video from AVForums

Podcast: Panasonic JZ2000 Final Thoughts - TV Calibration: Should you? And More...
Subscribe to our YouTube channel

Latest News

What's new on UK streaming services for December 2021
  • By Andy Bassett
  • Published
Best Projectors of 2021 - Editor's Choice Awards
  • By Steve Withers
  • Published
Black Friday 2021: What you need to know
  • By Andy Bassett
  • Published
What's new on Blu-ray Special - The Cinema of Zhang Yimou & Gong Li
  • By Mark Costello
  • Published
AVForums Podcast: 24th November 2021
  • By Phil Hinton
  • Published

Full fat HDMI teeshirts

Support AVForums with Patreon

Top Bottom