Pension stuff, how's it all looking ? HAve you prepared ?

[weeksy]

It also begs the question why does Mrs Weeksy need £650k plus two pensions, plus a state pension?

If you’re happy with how things are now then why provision for a massive amount more? My plans just ensure my missus gets to maintain our current standard of living, not that she gets rich if I die

THat's just how it worked out. I took out the life insurance 20 years ago, which was a 30 year plan. This was back before we even had a mortgage.

The other chunk is from death in serivce from work...along with my pension, which obviously when i first did all this didn't really have much of a value.

We've also got equity in the house, which again, back when i took this out, didn't exist either as we were on a 100% mortgage and £50k in negative equity.

So it wasn't planned that she'd be in for a massive chunk, that's just how it's kinda worked out.

[Count Steer]

A-a-and finally. Many company pension schemes* ie final salary, don't simply switch the pension payout to your partner when you die. You have to sign a mandate for them to continue to pay them at a 50% rate (and accept a reduction in your payout as they are effectively insuring based on whoever lives longest á la actuarial tables type of thing, that's statistically likely to be the woman by a significant margin). Personal pensions are a different matter.

* and annuities

[weeksy]

A-a-and finally. Many company pension schemes* ie final salary, don't simply switch the pension payout to your partner when you die. You have to sign a mandate for them to continue to pay them at a 50% rate (and accept a reduction in your payout as they are effectively insuring based on whoever lives longest á la actuarial tables type of thing, that's statistically likely to be the woman by a significant margin). Personal pensions are a different matter.

* and annuities

Must admit, i don't know and have not checked in detail what happens with mine if i die before we get to that stage, but i can't see there being a lot i can do about it, so whatever happens, happens.... i won't be here to question or worry lol.

Tell you what one of us should do though.... A breakdown in cost of 'monthly outgoings' assuming no car payments, just a basic lifestyle. I wonder what that figure would be... I'm guessing £1200 a month. I wonder how far out that is.

[Mr. Dazzle]

I've signed the forms so that Mrs D gets 100% of my pots if I die.

I don't think she's had the courtesy to do the same thing for me yet

[Count Steer]

A-a-and finally. Many company pension schemes* ie final salary, don't simply switch the pension payout to your partner when you die. You have to sign a mandate for them to continue to pay them at a 50% rate (and accept a reduction in your payout as they are effectively insuring based on whoever lives longest á la actuarial tables type of thing, that's statistically likely to be the woman by a significant margin). Personal pensions are a different matter.

* and annuities

Must admit, i don't know and have not checked in detail what happens with mine if i die before we get to that stage, but i can't see there being a lot i can do about it, so whatever happens, happens.... i won't be here to question or worry lol.

Tell you what one of us should do though.... A breakdown in cost of 'monthly outgoings' assuming no car payments, just a basic lifestyle. I wonder what that figure would be... I'm guessing £1200 a month. I wonder how far out that is.

Probably only takes one phone call to your pension people to find out what happens when you peg out after retiring. If it's a personal scheme like Dazzle's it's probably irrelevant as it's basically a 'cash' asset. If it's a more traditional company pension/annuity arrangement then it's worth checking.
Outgoings - just run the numbers. I think you'll find £1200 is pretty basic. On the plus side there are lots of potential savings on retirement. It won't be the same for everyone obvs but the amount that just used to disappear on commuting costs (pre-covid times!), lunches, decent suits, shirts, shoes, eating out (too knackered/late home to cook), expensive holidays and other things that seemed more important to reward myself with when the pressure was on etc etc was, in retrospect, quite a lot. On the down side you don't turn the heating off for 12 hours a day

[weeksy]

Probably only takes one phone call to your pension people to find out what happens when you peg out after retiring.

I get a big booklet every year, i'm sure it'll be in there. Just not actually looked.

[Yorick]

On the down side you don't turn the heating off for 12 hours a day

What's heating ?

[Taipan]

A-a-and finally. Many company pension schemes* ie final salary, don't simply switch the pension payout to your partner when you die. You have to sign a mandate for them to continue to pay them at a 50% rate (and accept a reduction in your payout as they are effectively insuring based on whoever lives longest á la actuarial tables type of thing, that's statistically likely to be the woman by a significant margin). Personal pensions are a different matter.

* and annuities

Must admit, i don't know and have not checked in detail what happens with mine if i die before we get to that stage, but i can't see there being a lot i can do about it, so whatever happens, happens.... i won't be here to question or worry lol.

Tell you what one of us should do though.... A breakdown in cost of 'monthly outgoings' assuming no car payments, just a basic lifestyle. I wonder what that figure would be... I'm guessing £1200 a month. I wonder how far out that is.

That's a thing that makes living abroad so attractive. My Mate lived near Murcia for a good few years. He has a pension from the Army and LFB that he managed to get early due to bad health. He said the cost of living in Spain was so much cheaper compared to here, that he never felt like he had to compromise on his spending. He's back here now and doesn't stop moaning about how expensive it is to live here!

[weeksy]

That's a thing that makes living abroad so attractive. My Mate lived near Murcia for a good few years. He has a pension from the Army and LFB that he managed to get early due to bad health. He said the cost of living in Spain was so much cheaper compared to here, that he never felt like he had to compromise on his spending. He's back here now and doesn't stop moaning about how expensive it is to live here!

Which bits though ? I've never thought supermarkets in spain/france were any better than the UK ? certainly not night and day anyway.

When going out for food, again, not too different. Pizza is £12... or 12Euro anyway... so essentially the same in France as in the UK.

Beers £3-4 a go... so i'm not seeing much in terms of savings there.

Spain when we've been to Orgiva for example could potentially work out cheaper in some ways... but not much from what i've seen.

[Taipan]

That's a thing that makes living abroad so attractive. My Mate lived near Murcia for a good few years. He has a pension from the Army and LFB that he managed to get early due to bad health. He said the cost of living in Spain was so much cheaper compared to here, that he never felt like he had to compromise on his spending. He's back here now and doesn't stop moaning about how expensive it is to live here!

Which bits though ? I've never thought supermarkets in spain/france were any better than the UK ? certainly not night and day anyway.

When going out for food, again, not too different. Pizza is £12... or 12Euro anyway... so essentially the same in France as in the UK.

Beers £3-4 a go... so i'm not seeing much in terms of savings there.

Spain when we've been to Orgiva for example could potentially work out cheaper in some ways... but not much from what i've seen.

I guess it depends where you are, but where he was (San Pedro del Pinatar) beers and food were very cheap. Cheap enough to eat out most of the time. A meal with a drink included in a lot of places used by ex-pats were under 5 Euros. Most things in the supermarkets were cheaper too, but we found this to be the case in Catalan supermarkets too. Things like council tax was ridiculously cheap and of course you don't need much heating. He had a heating system in his place but only ever used the log burner to take the chill out of the occasional winters evening. I didn't ask him about his car and bike insurance. Wished I had now!

[JackyJoll]

I gave up working for a living on Jan 4th, a day after 65th birthday.

I have 34 years in a final salary scheme. It’s divided into pre-2009 and post-2009, so it’s two schemes in the same job. The pre-2009 scheme has paid its lump sum and two instalments by now, as you’d expect.

The later scheme has paid nothing yet, because there are Additional Voluntary Contributions. No money can be released until the AVC money is settled in an annuity (or whatever the pensioner does with it). I did not know that, until they sent the forms last November.

Yes it has taken this long for the fate of the AVC money to be negotiated.

It’s no problem to me, because it’s only 1/3 of my pension and I have the lump sum and monthly instalments from the older scheme and quite a lot of accessible savings and a paid-off mortgage. Oh and a good working wife haha.

But it could be a problem for someone else who has AVC in a sole scheme or in all their schemes.

I just thought it might be a helpful warning to someone.

[Pirahna]

I gave up working for a living on Jan 4th, a day after 65th birthday.

Happy retirement.

[JackyJoll]

I gave up working for a living on Jan 4th, a day after 65th birthday.

Happy retirement.

Thanks. It’s something of a shock.

[Pirahna]

I gave up working for a living on Jan 4th, a day after 65th birthday.

Happy retirement.

Thanks. It’s something of a shock.

Sounds like you had a plan and were well prepared for it, it sort of crept up on me. I'm younger than you so might yet do some more work, then again I might not. I'm more or less enjoying van life at the moment so we'll see what happens.

[JackyJoll]

Here’s a thing. If your pension pot exceeds £ £1,073,100 you’ll be taxed on it.

If your (including your employer’s) contributions exceed £40,000 per year, you’ll be taxed on it. Can be averaged over three years.

[JackyJoll]

One last thing I noticed recently is the tax on savings interest.

If interest rates go up, you won’t have to have a vast amount of savings to go over your personal savings allowance.

[Taipan]

I've been thinking about semi-retiring this year. Just drop down to a 3 day week, but, money has never come easy to me and we're not big earners etc. So, walking away from money to basically loaf about, seems kinda wrong and a bit hard to get my head round?

[JackyJoll]

One last thing I noticed recently is the tax on savings interest.

If interest rates go up, you won’t have to have a vast amount of savings to go over your personal savings allowance.

It's still better to get 80% of something, than 100% of nothing.

Yes, but rising interest rates may make ISAs more relevant.

Not that we’ve seen savings interest rising much yet.

[Count Steer]

I've been thinking about semi-retiring this year. Just drop down to a 3 day week, but, money has never come easy to me and we're not big earners etc. So, walking away from money to basically loaf about, seems kinda wrong and a bit hard to get my head round?

Retirement = loafing around. LOL. I wish.

If you don't mind doing what you're doing and they pay you, keep at it TP. Reducing the days is a great way to ease into 'loafing around'.

[JackyJoll]

So, walking away from money to basically loaf about, seems kinda wrong and a bit hard to get my head round?

I very much understand that. I was in full time employment for 45 years.