Yes I know I should see a pensions advisor but…

How much per month should I be putting into a pension?

Is there a simple rule like x% of monthly salary or Required pension amount / number of years to retiring etc?

Cheers

I guess the first question you have to ask yourself is 'Will I be around long enough to get any of it back?'
Riding up narrow planks 20ft in the air is probably not the best way to get to pension age.
As for how much, I don't know. Alot depends on your age , income, disposable income, tax position, retirement expectations , what you have accrued in other pension schemes etc etc.

I've been told 6 – 7% of salary is usual.

Finish my probationary period on Weds so I'll be going for 7%

I pay 7%

Depends very much on how long until you retire tho and how big a retirement income you want – one for real advice

Closer you are to retirement the more you should be thinking about putting away.

Likewise younger you start putting pension money away the more risky you can afford to be with it.

Sure there are some decent pension calculators out there if you spend some time googling. It's been a few years since I last looked into it though,

Better to get some good advice, try and get a good independant advisor to review your personal circumstances.

6 or 7 % is pretty common with a contribution from your employer as well hopefully. You can put in as much as you want to usually, even all of your salary if you wish! It does come off of gross salary which is a plus. Annuities were absolutely shocking lately and probably still are, so to getting a pension from them wasnt that atractive, but the market will change, and as said above you need to balance heavily investing in a pension with what you need cash for now. Bear in mind that money will be locked away for a while.

What makes a pension very attractive for investing in is when an employer matches your investment up to a certain level. For example one of my employer matched every 1% you put in with 1.5% up to a max of 9%. So for 6% of your gross salary you were getting 15% put into a fund! If you contributed nothing you would only get half of that 6% in your hand as take home pay if you are a higher tax payer. Which made it a no brainer.

The last person you need to see is a pensions advisor – more commonly known as a salesman. Ever heard of a Double Glazing advisor or Second hand car advisor. I wouldn't bother as pensions are for the benefit of the life companies not the policy holders. The amount of money you'll have to save is astronomical – just to get a £18,000/annum annuity you'll need to save £300,000. It's like buying another house on the side and remember this is not allowing for inflation so in 30 years time you'll probably need £1,000,000 saved up. All your contributions will disappear in commissions, fees and stock market crashes. Educate yourself and manage your own money – don't let the financial industry thieves near it.

he last person you need to see is a pensions advisor – more commonly known as a salesman. Ever heard of a Double Glazing advisor or Second hand car advisor. I wouldn't bother as pensions are for the benefit of the life companies not the policy holders. The amount of money you'll have to save is astronomical – just to get a £18,000/annum annuity you'll need to save £300,000. It's like buying another house on the side and remember this is not allowing for inflation so in 30 years time you'll probably need £1,000,000 saved up. All your contributions will disappear in commissions, fees and stock market crashes. Educate yourself and manage your own money – don't let the financial industry thieves near it.

While i agree with *some* of your cynicism, I'd still say any scheme that you employer contributes to is worth being in. You're taking a pay cut if you dont participate. Me, Im counting down till my final salary scheme is taken away from us 🙁

Last time I saw a pensions advisor ( ? ) I came away in disgust ,,,,

After taking loads of notes, he did a few sums and tried to tell me that for the equivalent income as pension to the one I was earning at the time I needed to save X pounds per month … main issue I had with that was X pounds a month was more than my GROSS wage … never mind my net one ….

Never been back since ….

Enjoy life now, don't worry about the rainy day in the future … you may not live long enough to see it

pensions are a bet – you're betting that people who allegedly have to be given huge bribes to stay in this country to steal all your money won't steal all your money between now and when you're to helpless to do anything about it. So, never put more into a pension that you're willing to kiss goodbye to.

for instance, I have a pension accrued over a couple of years working for a company which subsequently went into receivership. The funds are held by Confederation Life, but they won't talk to me about them, referring me to the trustees – and this is in their interest as, if I cannot claim the pension, they get to keep it. The trustees, also the directors of the former company won't talk to me because they don't feel like it. I don't even know how much money is involved as I've never had a statement, but I'm fairly sure the entire amount would be consumed in no time at all were lawyers to be involved…

http://www.moneysavingexpert.com/savings/discount-pensions#howmuch

"Take the age you start your pension and halve it.
Put this percentage of your salary aside each year until you retire."

Well I'm starting to build a pension fund now – bit too close to my 40th birthday to be doing that I'm sure! Well I thought I'd put a big dent in mortgage first. Anyway, my company was just changed from 2.5% to 5% contributions, which I have to match, and the money goes into buying unit trusts of my choice. So very little in the way of commission going on and I can log in to see how the funds are doing. All seems sensible to me.

So very little in the way of commission going on

That's what you think – all the costs are hidden – somebody will be getting a kickback somewhere

i put 15% into mine (6% + 9% from company), which is all pre-tax so it works out around 20-22% of my take-home pay. Just had the paperwork through from last years performance – the pot gained 50% through the stockmarket (a rare occurance, due to it having a smashing year). Pensions are great because they're all pre-tax, even if 'those thiefing manager gits' take 1% a year, having 25% extra per year cos you're not taxed on it is quite nice.

I might not live to see the benefit of it. I'm 27, and commonly ride off large objects high in the sky. On the flip side, I could live till 100, in which case dropping 6% of my take-home on a monthly basis to live in comfort for 35 years seems like a pretty good deal. My grandpa died last year. He was 97. He'd been pulling his pension for the same number of years he'd been paying into it (started work for the government at age 23)

worth thinking about..

7% seems very low, I'd be looking at 20% rising upwards slowly with age. Annuity rates have fallen dramatically over the last decade and are on a slow downward slope, so you don't get much for your money.

"Take the age you start your pension and halve it.
Put this percentage of your salary aside each year until you retire."

That's pretty much the ballpark figure I've heard

So 7% is fine if you start at 14 😆

All your contributions will disappear in commissions, fees and stock market crashes

No they won't. Stock market crashes are good as long as you aren't cashing it in when the market's low. Stocks go down, consequently your contributions buy more. Don't forget you're cashing it in 20 years' time, so who knows what will happen. 20 years ago the FTSE100 was 2000 some-odd.

SFB – try the Pensions Ombudsman , it will only cost you the price of a stamp

Think I'll buy property or invest in business instead.

Until they make pensions secure and I'm dam well not retiring in England.

Hmm China or India? ;O)

Stock market crashes are good as long as you aren't cashing it in when the market's low.

So you've got to lucky when you cash in – you may not have the choice in the timing.

Yes Teef , You can defer to draw or cash in your pension rights with most providers.My Dad deferred drawing one of his pensions, then died . Which was harsh, but alot of the fund got transfeered to Mum as it was a company pension with spouse benefits.

>So you've got to lucky when you cash in – you may not have the choice in the timing.

Sensible pension strategies start tapering a pension pot portfolio away from equities and into less risky vehicles about 10 yrs before retirement date. Obviously you could encounter a "perfect storm" but to leave your entire pot in equities until retirement time and then cash in the whole lot is madness.

I though this thread was going to be about how much we're getting from our pensions 🙂

I've just had a nice letter telling me that mine is going up by almost 3% this year.

Pensions are hard to resist because of the tax back part and if the employer is contributing it is silly to miss out on free money. That said commissions are normally 2-3% IME (initial plus annual management), and those fund managers don't half cock it up sometimes. Personally I think getting on the housing ladder and paying off a slug of the consequent mortgage is better. ISAs are not to be ignored either as they are tax free as they grow and when cashed in and you don't lose the lot if you die before retirement.

I can't afford to pay bills never mind save in a pension plan

you don't lose the lot if you die before retirement.

You wouldn't lose your pension pot either. There is a worrying amount of misinformation on this thread.

As with any investment, pensions are a risk. So spread your investments and reduce the risk.

Those who suggest ignoring your pension and just buying property, what happens if the housing market crashes just as you want to retire?

As with any investment, pensions are a risk. So spread your investments and reduce the risk.

Correcty. Pensions are – on the whole – low risk (or sold as such), hence the fact that annuity rates are getting worse. It doesn't help that the baby boomers all lined themselves up lovely final salary schemes and have f—ed over the rest of us – an entire generation got to retire early, on good pensions, they own everything and, now they're getting ill, are being paid for by the relatively dwindling taxpayers.

Where was I? Oh yes, you need to think about saving more than just a pension. You cvan get great returns if you buy a slice (a very small one) of a private equity/venture capital fund, but the risk is high. You can put it all into a current account (spread around to avoid an Iceland), but the rates are low. Property is good in the boom times, but right now its value is only rising steadily (if at all) and is highly illiquid.

Naturally, though I'm now 33 and have been working full time in a reasonably remunerated profession for the last 8 years, I have a tiny pension pot (worth SFA, frankly), equity in a house I couldn't sell if I wanted to, and no savings, so don't listen to me.

Especially if you're a baby boomer.

SFB

Are you not a council employee with a final salary pension per chance?

The thing is, as the birth rate drops – which it is almost everywhere, below replacement level already in countries like Italy – the proportion of oldies increases, and whatever the value notionally attached to money, those left in work have to generate the output and services to support those unable or disinclined to work. I can imagine before too long the young might question the burden, and perhaps a little runaway inflation might devalue most of the savings without troubling those in work, so the wrinklies are forced back into work – and of course into competition with the young for jobs 🙁

Are you not a council employee with a final salary pension per chance?

no I am not 🙂 And of course that huge pension burden will come home to roost before long – not that I begrudge public employees their entitlements, but I do wonder how they can be paid…

not that I begrudge public employees their entitlements, but I do wonder how they can be paid…

explain further please?

not that I begrudge public employees their entitlements, but I do wonder how they can be paid…

explain further please?

The current value of the pension promises made by Local Government to its employees is about £60 billion more than the money they have put aside to cover them. That doesn't include pensions for central government, teachers etc. So to total shortfall is much bigger. Eventually the taxpayer will have to pay for this.

I think that's what Simon is referring to.

I think I pay 6% and I've been paying that for the past 35 years, 5 more years and I get a 6% pay rise 😀

those left in work have to generate the output and services to support those unable or disinclined to work

This is only really true of unfunded pensions, like the public sector ones referred to later and the state pension (which most people expect to gradually disappear). In theory pension funds should be invested in the industries that provide jobs for the next generation, which is sustainable and sort of how it used to work before the pensions industry was dismantled – a job started by Ken Clarke but comprehensively finished off by Gordon Brown.

Pensions, are they not Ponzi Schemes?
A Ponzi scheme is an investment fraud that involves the payment of purported returns to existing investors from funds contributed by new investors. Ponzi scheme organizers often solicit new investors by promising to invest funds in opportunities claimed to generate high returns with little or no risk. In many Ponzi schemes, the fraudsters focus on attracting new money to make promised payments to earlier-stage investors and to use for personal expenses, instead of engaging in any legitimate investment activity.

My choice boiled down to either paying for a pension for my working life or working towards paying off the mortgage as soon as possible.

In todays climate i think being mortgage free is more important than the guessing game that is pensions and investments.

I have endowment and part pensions but i will have 20yrs of working life to save up some more money with the guarentee that i own my home behind me which i find more important than a 'possible pension'

Just read somewhere that you should half the age you started paying a pension and that's a good rule of thumb to how much you should now be contributing hence if you started chipping into the pot at 22 years of age then you should contribute 11% starting at 36 years old would see a rather unhealthy chunk of 18% etc…

Try this BBB

http://www.h-l.co.uk/pensions/interactive-calculators/pension-calculator

er, i heard the same as 'tank' – i remember someone somewhere who spoke confidently about it saying:

'half your age, as a percentage of your salary'

(at the point when you start paying into your pension scheme)

so, if you're about 30, and get paid £25,000, you should be pay in 15% of £25,000 = £3750 per year, every year.

it sounds like a lot, so it's probably right…

(i assume this is split between you and your employer)

I have been paying about 10-12% (though a bit more recently) for the last 33 years + employers contributions. It is final salary and I consider myself lucky to have it.

Best advice I would give is not to have all your eggs in one basket. I also bought a buy-to-let property 11 years ago (now paid for) and been investing in the stock market (share ISA's)for nearly 15 years. Plus cash.

Should be retiring later this year – thanks to the final salary pension mainly. But the other things help.