leyburnrunner
Midfield
My IFA's advice to younger pension contributors is to very much hike the risk index upwards. His reasoning being the amount of time left to turn it around should the financial markets tumble.
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Retirement
- Thread starter Shieldsman
- Start date
@James Just to play Devil's Advocate, don't ignore the savings and flexibility to be made by investing in say an ISA alongside adding to your pension. You want to give yourself as much freedom as possible. For me, that means giving up a bit of pension contribution and instead putting it into an ISA where I can access it more freely, potentially giving me more financial independence earlier. Otherwise I'd be potentially mid-40s or early 50s counting the years to being able to access my private pension.
Of course, the down side is you don't get as much additional funds from the government, employer etc.
Of course, the down side is you don't get as much additional funds from the government, employer etc.
faith brothers
Striker
I did that years ago it's a good idea. The main problem for me was it was with Equitable life!
OldNewtown
Winger
Ouch!!!
Darlo1973
Striker
I agree - pensions are essential but it's useful to have some money outside of them which can be used more flexibly - either for an early retirement, period of unemployment or life emergency.
Really need to look at where your income is coming from in 4 stages
1. Work
2. Savings/Investments
3. Occupational pensions
4. State pension
I started salary sacrificing about 7 years ago (60 this year) and I've been increasing it by 1% or 2% per year when (if) a pay rise kicks in. I'm just about to hit 10% (i'll do that next week), my employer puts in 12%. wish i'd started a decade earlier as it's really helped my pot, so if you can do it then crack on!
I’m 46 and now pay in 20% which is matched up to 7.5% by my employer. In my 30’s I probably went from 5% upto 10%. I moved firms a year ago and got a good payrise and seeing as I didn’t ‘need’ all of the extra money I figured I wouldn’t miss it so bunged it into the pension contributions.
I’ll echo the other poster who said to do what’s best for you. Only you know your financial situation - income, bills, life events, caring commitments, employment prospects etc etc.
Only had 1 in 3 months but I enjoyed it . Not fussed on drink that much at the minute . No work tomorrow still sounds class in my headWell one thing for sure there is nowt better than a Sunday slurp after a hard week retired
Edinburgh Black Cat
Striker
As a minimum, put in whatever your employer will match.
Above that, it gets complicated. In hindsight I'd have put more in a S&S ISA when I was younger and significantly increase pension as I get older (or more specifically as my salary gets to a level it is more tax efficient to do so).
Using ISAs, you still get the compound gains but it gives more flexibility to retire early.
If you haven't ever bought a house then a LISA is a no brainer.
Hadn't read this when I posted, but snap!
The default advice to 'put as much as you can afford into your pension as young as possible' is out dated.
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I'm Spartacus
Striker
I used to have to get dressed up as Welephant, it was the probies job when I first started. Before we left the station for whatever event we were going to, I put the bottom half of the costume on backwards so it looked like he had a git big cock and walked through the station waving it around (and more rude things). Everyone thought it was funny except the miserable gaffer who had a moan. Boring bastard.
Agree with one exception. If you're not very good at saving (or your default position on money is to spend it), putting money into a pension scheme (especially via PAYE) is a very good way of making it inaccessible for a long time and avoiding temptation to spend! So for those with less day-to-day financial discipline it has that clear advantage
.52 now and just lost my sister in law aged 47
. Really focused on saving to 60 retirement but now thinking of dropping a day at work as nothing is guaranteed. Think we'll still manage to quit at 60 or worst case take bits of temp work.
Was planning on starting two sips and putting in an initial lump sum £500 each for the next 8 years to add to our final salary scheme however the cash isa rumours are making me think I should perhaps max out these this year.
Has anyone looked into the cash isa predictions. If she announced it in July will we still have the remainder of this year to throw in 20k or will it be immediate?
. Really focused on saving to 60 retirement but now thinking of dropping a day at work as nothing is guaranteed. Think we'll still manage to quit at 60 or worst case take bits of temp work.Was planning on starting two sips and putting in an initial lump sum £500 each for the next 8 years to add to our final salary scheme however the cash isa rumours are making me think I should perhaps max out these this year.
Has anyone looked into the cash isa predictions. If she announced it in July will we still have the remainder of this year to throw in 20k or will it be immediate?
archiesdad
Midfield
It's really handy to have funds across a number of wrappers as it helps with tax. It can be a bit of a juggling act once it's time to access it mind. We have about 60% in DC pensions, 5% DB pension and the rest in isa's and bonds.
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Barista
Midfield
Exactly this. As you get nearer to 55 (or more likely 57+ now), you can then increase the % going into the pension vs ISA as you know that you will be able to access the pension if needed in the near future.
When I turned 50 I planned on retiring on 55. The work salary sacrifice scheme was really generous, in that as well as me saving all my NI, they actually passed on to me all their employer NI savings.
Therefore I salary sacrificed almost 2/3 of my salary for my last 5 years of work. What was left of my salary was not quite enough to live on day to day, so I simply used money I had saved into my ISA to top up my salary. This way I was able to maximise the tax+ NI benefits of salary sacrifice. I then retired as planned at 55 and am now drawing down my SIPP.
Matt Hopkins
Winger
Nothing is guaranteed to change, but if it did, it would be nigh on impossible to have an overnight change.52 now and just lost my sister in law aged 47
Was planning on starting two sips and putting in an initial lump sum £500 each for the next 8 years to add to our final salary scheme however the cash isa rumours are making me think I should perhaps max out these this year.
Has anyone looked into the cash isa predictions. If she announced it in July will we still have the remainder of this year to throw in 20k or will it be immediate?
gizmoganzee
Striker
I started doing this at 60 and hope to build up work pension, Sipp and Stocks and Shares ISA by the time I'm 67.Put my application in to reduce my hours today wed 1 sept. Not retirement but 4 in 3 off has got to be better than 5in/2off. Still should be able to save quite a bit to retire at 60.
