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The Art of War is an excellent book. Especially the bit about choosing and avoiding battles.
I've never really understood how people get to such high numbers for what they'll need in retirement. I think (excluding the mortgage) even the minimums there might be more than we live on now. Definitely if you exclude some of the more frivolous purchases that we could easily live without.
kramer - you're a GP, I think.
You could advocate for a free copy of The Art of War to be given to every new patient at your surgery; alternatively - or additionally - a copy to every new mum at hospital to be read and then passed on to their children.
We'll have have a nation of warrior leaders in two or three generations!
Aidy, discussion has now moved on to Chinese philosophers and warriors.
Do keep up.
This is my brother’s, who is a pension actuary, rule of thumb. But as he says what do you expect when people who benefit from DB pensions draft the rules.
Thanks mefty, first time I've heard a 'sensible' answer and previously most folk told me I was wrong (as per posts on this thread), but I could see the evidence through my own pensions.
I’ve never really understood how people get to such high numbers for what they’ll need in retirement. I think (excluding the mortgage) even the minimums there might be more than we live on now. Definitely if you exclude some of the more frivolous purchases that we could easily live without.
I too have always been sceptical, but for every millionaire there's a multitude of folk on the poverty line...
One thing I do know from experience (my folks & my OH's folks) is that spending drops off as you get older, especially if you own your own house/flat etc.
For folk that say that DB pensions 'die' with the owner - my MIL collected 5 years of 60% of my FIL's pension and my Mum is now passed 5 years of 60% of my Dad's.
I reckon though that overall folk retiring now (and in the future) will have lower pensions purely as the DB schemes fade out AND even the public sector DB's drift to less valuable outcomes. The USA is already going through this with high percentages of Boomers relying on the state.
The richest man in the world is he who smiles the most
Bloke who sits near me at work, postioned very high up in the company, spends A LOT of time talking to me about his pension pot and plans, escaping at 55 etc etc. He earns prob 4x what I do though.
Does very little in life outside of work. Most miserable man I've ever known 😂 Wouldn't swap with him - I would rather be skint (with a bike at least)!
Seems obsured to me to spend your life worrying ad nauseam about your old age, and not living now.
Pension Q - from a tax perspective is it better to pay more via salary sacrifice (assuming you’ve hit the employers contribution limit) or adjust later via self assessment after paying into a pension from your salary after you’ve recieved it?
The latter way avoids employee NI and employer NI. To encourage takeup of this method, some employers will offer to hand employees a proportion of their saving.
I think you mean former way? I.e. by salary sacrifice is best, to avoid NI
I’m trying to work out which is more tax efficient for me personal contributions, to sacrifice more salary and put say £100 a month more into the work pension, or to pay into my personal pension after I’ve been paid.
I've been using James Shacks retirement planning sheet here and found it very well thought through - for example it allows you to model changes in income requirements at different stages of retirement (active, sedentary older, long term care etc)
https://james-shack.co.uk/retirement-planner-download
also this video is well worth a watch
from a tax perspective is it better to pay more via salary sacrifice
with salary sacrifice all the tax saving is going into your pension. i.e. you are saving all your money into the pension fund. If you invest into a personal pension and reclaim through your tax return, although you get the higher tax offset against your bill, you haven't actually invested the money in your pension.
So as long as the salary sacrifice scheme is invested in funds that are performing well and not too high on fees then I'd say salary sacrifice was the best route.
I think you mean former way? I.e. by salary sacrifice is best, to avoid NI
I did, sorry!
To encourage takeup of this method, some employers will offer to hand employees a proportion of their saving
Check if this applies to you kryton. My employer adds 13.8% NI equivalent onto any contribution I make, which makes an insane difference.
I can either have £58 in my bank or £114 in my pension...
Hence I'm currently dumping about half my salary in my pension each month.
<Edit to say I'm sure my numbers above aren't quite right, but CBA working it out exactly.>
Mine does too, and in to my C2W payments. Which is nice.