How much pension for a comfortable life?

Maggiemaybe, I bow to your current knowledge, my experience of state pension was 7 years ago. I did have SERPS and also some other enhancement that I paid into (AVC's ???) and I do get more than £8k/yr/ Mrs.P on the other hand did not have a full entitlement, but she did get it at 60.

All very complicated.

PS abbey Somebody may have said this, but you can make voluntary contributions to make up the shortfall in your NI contributions.

I don't have a huge pension, only around £10,000 in all, but suggest that if you really want to retire you should do it.

If your capital is invested you can use the income (or not) as you wish. But remember, as others have said, life is uncertain and you can't take it with you. So why not retire now and use some of your inheritance if necessary to make the most of your life. That is what we have done.

We don't like to go on expensive holidays, but we do run a car and live well. If age or infirmity require it, we will move to a smaller house later, but at the moment enjoy living in our lovely home.

Some years ago I invested part of my inheritance in a very small flat with a private garden which would suit one of us well if we should be alone in very old age, and in the meantime it delivers a decent rental income.

That's a thought though, abbey, you only need 30 years now, not 35

It was 30. You need 35 years now. They put it up in 2011. I got caught in that one too. If it were 30 years I would go without hesitation as I have 30 years NI contributions now.

Just like I got caught in the increase of pension age twice
(from 60 to 65 and from 65 to 66).

Abbey, for you there is a middle road, which is the one I took.

I was very lucky, I had a major mental break down at 55, and after that found work very stressful for a variety of reasons. At 57 I was made redundant, which forced my hand. My boss at the time, the financial director, help me decide the best way forward (I respected his judgement).
I decided to take all the monthly pension on offer from that day (no lump sums). I continued to work on contract for a few months, but the decided I'd had enough and we (Mrs P and I) decided that we could survive somehow.
And here is where the middle ground comes in, I found a part time job with Age Concern as a carer in a day center, this only paid minimum rate, bit was stress free and very worthwhile, hence enjoyable. Being part time 3/4 days a week it gave me time to enjoy other things. Whilst this still left us worse off financially at that time, it gave us enough to live on.

Going from a senior position in IT with a multi national company to being a carer was such a big change that it never seemed like work. During my 6 years with AC, I laughed and smiled more that I had in the previous 34. Life is too short to hate your job.

A very brief warning. If you are thinking of retiring abroad please be aware that your State Retirement Pension is not index linked in many overseas countries. The pension is frozen at the level at which it first becomes payable in the host country and places like Australia, Canada, New Zealand and South Africa as well as Thailand and 120 others do not get the annual up-rate. Illogically and irrationally the USA and the Philippines, for example, do. So, too, for the time being at least, do those retired in EEA countries.
The downward spiral can be devastating as the years pass and about 2,500 pensioners return to the UK each year because this iniquitous policy means that it is no longer financially viable to live abroad and suffer the discrimination.

And yes, I agree, this thread has me feeling

Sorry to be unhelpful but if you have sons or daughters living abroad and hope to see them regularly then you can get through your pensions quite quickly. I know quite. A few of you will be in'the same boat' as us and will know how tricky it is to make regular journeys often long haul.

Hi Wobblybits. I actually think £8000 is the maximum state pension now, as SERPS and the second state pension no longer apply. The (roughly) £155 is what you get whether you've worked 30 years or 50, and though there is a minimum salary requirement, you don't earn extra pension for a higher one.

That's a thought though, abbey, you only need 30 years now, not 35.

Worrying about money is one thing, but worrying about being euthanised if you become a burden is crazy! Why not just seek professional financial advice and be done with?

Bear in mind that £30k is above the average wage. One financial adviser I spoke to considered that amount to be 'enough to live on comfortably provided you are sensible'

We live on an income of £14000 a year. Run a car, eat well, go out, have 2 cats. You don't need as much as you think to retire, anything is better than working, but we enjoy a really nice life.

At the risk of annoying you Abbey - go get a life - YOURS! Your husband, you say, seems worried (I would say obsessed) with how much money he needs or feels you both need to live. You indicate you already have plenty from various sources. You sound fed up with working, but also are really into the pounds and pence angles of contributions/loss per week/month re contributions - real nitty gritty calculations.
My advice (and it's well meant, whatever you choose to think) is to :
1. decide what you WANT to do. If it's to stop working, then stop.
2. tell your husband to stop ranting on about what HE needs.
I'll now get off my soap box.

In defence of the £10k from £13k pension figure. Our joint pension is NOW very close to our joint income when we were working. Taking that we no longer have a mortgage, and children to finance through uni, the effective income may even be higher than when we were working.

Funny you say that wobblybits, because I have in fact found this to be the case with my husbands work pension and state pension combined. His work pension is index linked and now stands at about £12+K ( as much as I earn pretty well) and then he gets £123 a week from his state pension (he got a small SERPS addition). Thats on the old pension which I think was £113 a week when he first got it. So, he ( we ) get £12K+ 6K from his pension now. I have £13K coming in and so we have a considerable unspent income given our lifestyle.

We get as much in pension and my earnings as we have ever had.

The downside of that is I have to work and so cant be at home doing things with him and my job is pressured.

Also, his pension includes half his pension as a widows benefit which will come to me if he passes away. Thats a fair amount of money really. Far more than we expected.

So, calculating my own income.I will get £8K from the "new" state pension ( assuming I put in the NI contributions) and also my own little £2K ( it might be a bit more) making £10K. Thats brings our joint income ( I reckon ) to a round £28K. when I retire. Which is pretty well what we have now..... OK a first world problem. I am comfortably off. But I do not take it for granted. Lots of things can happen. The bankers all go bust again and we have to pay or even instead of paying paltry interest on savings, they actually charge me for having money in the bank (it has been mooted).

Without my contribution though, we would be on £19K.

Assuming all things remain constant, if I have £8K pension + my own small £2K pension and then my husbands widows benefit, I would likely have a retirement income of around £15K. Which is pretty well what people say I will need. But I will have to work to 66 to do it.

I pleased that you have come to a decision.

My choice would be to enjoy today and not worry about tomorrow, too many of our friends have not made it until tomorrow.

I have just worked out the compound increase on my pension over 14 years, it works out a about a 50% increase, very significant.

I am 61. I need to gain another four years NI contributions to bring me up to 35 years paid in NI contributions for a full state pension I am told by the DWP that if I am short on NI,it will cost me at least £5 a week for every year of NI am I short.

I do need those contributions. When my husband dies I will not have a big income. My circumstances will be considerably reduced, especially if I am losing £20 a week (four years lost NI contributions). That would mean £6K instead of £8K in state pension.

I cannot make any back payments ( have checked). The bill for making voluntary/self employed contributions is eye watering.I could sign on but then they would expect me to find a job - any job ( maybe cleaning toilets) and if I have to do that, then I may as well be miserable in my present job instead.

I am afraid the state pension does have to factor in.

My savings may well have to be used, as someone said earlier, to fund my old age, care,maintenance of my home etc. to ensure I am not euthanised because I am a burden ( as may well be the bright new world future in the UK). There is no one to help.

I know for example that I will have to pay for cataract operations at some point in the future - maybe 20 years time or maybe next year, I dont know. My eyesight seems fine and my prescription isnt particularly strong now . I am a life time glasses wearer and the prescription has not changed in the last 15 years but I have cataracts apparently.( Thank you spec savers - told me I have cataracts but not how long before, or if ever, I will go blind). The NHS rations such things.

I will need my money at some point.

But to plan one has to know what ones needs will be and I dont think anyone can afford to be blaze and say, it doesnt matter. Its not about now,with hubby alive, its about when I may be alone and need the financial back up and the income.

Financial advisers and banks etc. seem to inflate the amounts needed. They say I have to have a pension pot which is also blindingly costly. Asking people what it actually costs them is a far more realisitic way of judging things I feel. Hence the question.

But I think I have my answer , so thanks to all.

In defence of the £10k from £13k pension figure. Our joint pension is NOW very close to our joint income when we were working. Taking that we no longer have a mortgage, and children to finance through uni, the effective income may even be higher than when we were working.
This is due to 2 things :-
I paid extra into my pension fund ever since I was 21 as I always planned to retire at 60.
All our pensions, private and state are index linked and have increase compound for the last 14 years.

So depending on your age, a pension can be similar to the salary that created it. I don't think we anticipated this effect when we retired, it is however what is making life financially comfortable for us now.

HOWEVER - Abbey you are too long dead to not enjoy the money you have NOW It is now that you are able to enjoy it, as you get older, you will be able to do less and not be able to enjoy it. As someone said so well, there are no pockets in shrouds.

is-

I agree with GK and PRINTMISS.

The least I can say is yours is certainly seems to be a First World problem Abbey. I have still not worked out what the problem actually is as you appear to know you will have 'enough and more' in retirement. Although there may be reasons why you are doing it both you and you husband seem, to me, to be finding problems where none exist.

Leaving everything else aside, abbey, the maximum state pension is around £8000. Where does your estimate of £10000 come from?

The state pension plus a little bit I am going to get from an earlier employment which had a pension attached to it. Hence £10K

OH! how I agree with Grannyknot. I was going to be rather rude, but I have decided to say that having money is a worry, not having money is also a worry, the bigger worry, really, because if you have money you can forget about it, and enjoy the day, so I would suggest you do just that.

Abbey with all due respect, this is the strangest thread I have read in a while.

Spending your inherited fortune on an "early retirement" is not wasting it. And as I presume you are in your sixties, it's not really an early retirement, is it?

Why you are hanging on for your State pension because you are entitled to it, but you don't actually need it, is impossible to understand. Well for me anyway. Your explanation is a "dog in the manger" approach.

As for your husband's pension (as he perceives it), you don't need that either.

And finally, as you own a fortune, you don't need to worry about how much is needed for you to retire on. You'll be fine.

Leaving everything else aside, abbey, the maximum state pension is around £8000. Where does your estimate of £10000 come from?