Pensions

[Jwoodgardenmaintenance]

19 minutes ago, Lucan said:

Firstly hats off to you for thinking about pensions at 21. I think a lot of people wish they had done that, myself included.

 

The answer is the earlier the better (ie now). A rule of thumb is if you start now you would only need a total contribution (so your contribution plus the external top up) equal to around 10% of your annual salary every year for a comfortable income for life once you retire.

 

The longer you postpone starting your pension, the higher the percentage you need to continually put in. I'm only about 10 years older than you and recently started, and I'm putting in 24% (although a bit more complex).

 

On average people your age will live to over 90, you might even experience 2100. Starting to invest for your retirement at 21 will probably be one of the wisest financial decisions you'll make.

I'm always planning 2 steps ahead! need to be like that no one else will do it for me and financial decisions are something I don't like especially when it comes to tools (toys) I like shiny new things that have literally no use to me but look really cool ? ? 

[spudulike]

So - you have two opinions, one where you save, build up some wealth over a long period, perhaps retire at 55-60 years and enjoy a bit or R&R. The other where you don't give a damn and just keep working till you drop - it never is that clear cut but these are the two options or somewhere in between.

Starting early is the best option, think of the old acorns to oaks adage - the longer the tree grows, the more logs you get!

Pensions are pensions and bound by pension legislation but there are other tax free savings out there that can give good returns such as equity ISAs, sure, you pay tax on your earnings but unlike pensions, when you take your savings out, you pay no tax and they are pretty flexible. If equity gives you the wobbles then the housing market may beckon.

It all depends on where you want to be once you hit 50-60.....where do you want to be?

[Ratman]

So - you have two opinions, one where you save, build up some wealth over a long period, perhaps retire at 55-60 years and enjoy a bit or R&R. The other where you don't give a damn and just keep working till you drop - it never is that clear cut but these are the two options or somewhere in between.
Starting early is the best option, think of the old acorns to oaks adage - the longer the tree grows, the more logs you get!
Pensions are pensions and bound by pension legislation but there are other tax free savings out there that can give good returns such as equity ISAs, sure, you pay tax on your earnings but unlike pensions, when you take your savings out, you pay no tax and they are pretty flexible. If equity gives you the wobbles then the housing market may beckon.
It all depends on where you want to be once you hit 50-60.....where do you want to be?

I’m hoping to throw it in at 52! [emoji6] we’ll see nearer time though. How old are you spud? (Me being a nosey sod and all![emoji39])

[Jwoodgardenmaintenance]

5 minutes ago, spudulike said:

So - you have two opinions, one where you save, build up some wealth over a long period, perhaps retire at 55-60 years and enjoy a bit or R&R. The other where you don't give a damn and just keep working till you drop - it never is that clear cut but these are the two options or somewhere in between.

Starting early is the best option, think of the old acorns to oaks adage - the longer the tree grows, the more logs you get!

Pensions are pensions and bound by pension legislation but there are other tax free savings out there that can give good returns such as equity ISAs, sure, you pay tax on your earnings but unlike pensions, when you take your savings out, you pay no tax and they are pretty flexible. If equity gives you the wobbles then the housing market may beckon.

It all depends on where you want to be once you hit 50-60.....where do you want to be?

I've actually just been online reading about this and basically say for instance my annual income is £26,000 & I pay 10% £2,600 then I get a 6% annual rise apparently once my retirement comes at 55ish hopefully I'd have a pot wort £523,000 which I really dont understand how that all adds up tbh anyways when I'm 50-60 I'd love to be sitting on my own farm with a good few heffers out in the field and my nice and shiny John Deere 7530 on a 2052 plate ? parked up outside ready for tinkering about the following day sounds like a plan to me ☺ 

[spudulike]

2 minutes ago, Ratman said:

I’m hoping to throw it in at 52! we’ll see nearer time though. How old are you spud? (Me being a nosey sod and all!)

Are you trying to date me ................54 so a little bit down the road of life from you.

Getting financially stable gives you options later in life - you can make your own mind up whether you work hard, take it easy or just lie back and catch up on your sleep. I think you will be bored if you knock it on the head too early, I would but it is having the option that you can if you like that is important and the lack of worry.

[spudulike]

1 minute ago, Jwoodgardenmaintenance said:

I've actually just been online reading about this and basically say for instance my annual income is £26,000 & I pay 10% £2,600 then I get a 6% annual rise apparently once my retirement comes at 55ish hopefully I'd have a pot wort £523,000 which I really dont understand how that all adds up tbh anyways when I'm 50-60 I'd love to be sitting on my own farm with a good few heffers out in the field and my nice and shiny John Deere 7530 on a 2052 plate ? parked up outside ready for tinkering about the following day sounds like a plan to me ☺ 

The £523K would give an annual pension of circa £26k but most would draw down a lump sum at 55. you then have a good old chunk of money to keep you going until you get your government pension kicks in.

Sounds like you have got the right attitude to making the most of early retirement.

[Ratman]

I’d still find/have plenty to do, not one for being sat about, but i wont be tied down to working for anyone full time by then i’m hoping. We want to see more of the world, so jump on a few boats and planes here and there in between and see whats out there. How long you been modding outdoor equipment for?

 

[Jwoodgardenmaintenance]

3 minutes ago, spudulike said:

The £523K would give an annual pension of circa £26k but most would draw down a lump sum at 55. you then have a good old chunk of money to keep you going until you get your government pension kicks in.

Sounds like you have got the right attitude to making the most of early retirement.

I love working but when low on work worry kicks in ect that's why I keep my overheads to a bare minimum so if I have a quiet few weeks I've got nothing going out my pocket so looking forward to having a steady Income no mortgages or anything just day to day living costs and whatever else I see what is shiny and new 

[spudulike]

16 minutes ago, Ratman said:

I’d still find/have plenty to do, not one for being sat about, but i wont be tied down to working for anyone full time by then i’m hoping. We want to see more of the world, so jump on a few boats and planes here and there in between and see whats out there. How long you been modding outdoor equipment for?

 

Been modding equipment most of my life but chainsaws for around 7 years. Got in to this line by accident after a long time in manufacturing and then a stint in sales. I look at things and think...I wonder what would happen if.........just my way and enjoy what I do despite some of the challenging things that roll in the shop!

[Ratman]

Been modding equipment most of my life but chainsaws for around 7 years. Got in to this line by accident after a long time in manufacturing and then a stint in sales. I look at things and think...I wonder what would happen if.........just my way and enjoy what I do despite some of the challenging things that roll in the shop!

Approx 70% of your life is spent at work, you need to be happy in what your doing or you’ll be miserable! So if it suits and your happy...... then crack on i say! Cheers for divulging [emoji106]