PENSION UK – When can I AFFORD to RETIRE? How much money do I need in my retirement? At what age can I retire? How much money do I need in my private pension? The level of income you want when you retire is key to understanding when you can afford to retire.
From this video I hope that it allows you to start thinking about the level of income and therefore the sum of money or sources of income you would need for your retirement. It’s also important to consider not only your private or workplace pension but also the income you will likely get from the State Pension as well.
In this video I provide various examples of levels of income and the assumed standard of living that would be associated with each in retirement based on the research provided by the Pensions and Lifetime Savings Association (PLSA).
I provide an example of how much money would be required to meet a targeted level of income.
Clearly the amount an individual will require in retirement will vary enormously from person to person based on their own circumstances and expectations. The research by the PLSA is to provide a practical and meaningful way for an individual to understand retirement saving.
CHAPTERS:
0:00 – Intro
1:15 – What are the PLSA Retirement Living Standards?
3:54 – Cashflow model using Mr & Mrs Pickles
4:24 – Cashflow model showing income levels
5:04 – How much did they contribute to their pensions?
5:32 – Cashflow model, impact on pension values
7:07 – Impact of inflation on pension values
7:56 – Cashflow model using Matty as an example
8:46 – Compounding growth of Matty’s pension
11:05 – Impact of market fall on Matty’s pension
12:20 – Link to follow up video
The three different standards of living described by the PLSA are based on a basket of goods and the associated costs of each, made up of household bills, food and drink, transport, holidays and leisure, clothing and personal care, and helping others. Link below:-
Please also see my follow up video on ‘Personal Pension – How can I take my Personal Pension? My retirement income options…’
My channel is for information and education purposes only. Any information or guidance given does not act as financial advice. Please consult a financial adviser if you are unsure in anyway.
My aim is to provide education and guidance to help individuals understand pensions, investments and protection….(read more)
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I’ve been paying into my pension since I was 22 (now 37) and continue to add more each year but I know I want to have a dramatic change in career at some point and realistically won’t be able to add the amount a do now. I think you might have answered my question which is if at some point I completely stop paying into my pension will it continue to grow.
I want to try and get it to a point that it will look after itself and look after me financially from age 60. I just don’t know when it’s at that level to allow me to do something else.
10k a year….rent is more
Thank you , its good to know all this information
With my work place pension and state pension I should be comfortable to retire at 67 but as of this year have started investing in property, crypto and blue chip stocks so hopefully these will allow me to retire a few years earlier
Should improve quality of sound
Thanks for Sharing your thoughts with us. Great video clip.
Hi Ed, I had to post my 'experience my with private pension – case study' at the end of the comments thread, before (below) this thread as it was the only way I could post it without it being deleted.
Would you be happy on a 18K pa final salary pension with 84K tax free lamp sum and state pension to come if all goes ok in ten years time plus a 50K in the standard life pension ?
Hi Ed, I've tried posting two comments in this section but they always disappear, are you removing them or is it YouTube?
Fact, the average Uk pension pot is £61,879.
I have only worked for about 20 years in this country the rest of my working years were in Germany as I lived there. Am I still entitled to a pension in this country. Plus how would I go about getting my pension from Germany
My rental is 1400 a month . How can I afford this after I stop work?
Hi Mr Bailey i was contributing my state pension since 2010 and retired at the age of 67 yrs old. I want to know how much my pension every week Thank you.
I hope so am 63 and will be relying on state pension only will I receive pension credit to cover my housing costs in full without losing any pension
Thanks for another excellent video!
What is probably not immediately clear is that this is all based off having a fully paid home at the point of retiral. Since there is a significantly large percentage of the population who chose to rent, it would be very useful – and enlightening(!) – if you could do the same but include average rent values in the monthly deductions. While this scenario is fully dependant on your pension/s at retiral, there will be many folks whose pensions would be severely hit by rent requirements. A follow on video on this might help persuade folks on the benefits of home ownership…of course, where they are in a position to afford the mortgage in the first place, and that's becoming a serious issue as time goes on!
So yes, please, a video covering this scenario.
If I already maxed out my ISA, is it just the best way to try and max out my SIPP or best to split between a SIPP and a general investment account?
11:49 I thought that 7.7% had market events in it already. So wouldn't the age 67 value be the same as before. Higher returns after 2008 made it 7.7% overall in reality. That time at least who knows next time.
Great video! I believe one thing that is missing from these videos (also from other channels) is how having children would impact the minimum/moderate/comfortable levels of income/pot when you have children. Maybe an interesting video would be adding “child born” events to the forecasts
Great Video! Is it possible to purchase the modelling tool?
I m in 1995 pension I joined 1987 left 2009 I'm 54 I've applied for my pension will it be reduced I heard I could have had it at 50 many thanks
Are their guidelines referring to basic, moderate, comfortable income etc stated gross or nett?
What website did you use to create those graphs?
I see you are a Financial Planner, is the planning tool you use only available for Financial Planners or can anyone use it? I’ve been using Guiide for a while: https://www.guiide.co.uk
I’m sorry, inflation is much more than 2.5%. Real inflation is looking at around 10-15%. Research cryptocurrencies and Bitcoin. It will be the only real option to accumulate wealth over the next decade or two.
Excellent video Edmund thank you.
Many thanks Edmund, glad I found your channel, so much useful information! Is there any benefit to having one of a two person household saving a lot into their pension and one saving very little. For example a 40% tax payer and a 20%. If the higher earner saves twice as much, they get the 40% tax relief when contributing. But then when it comes to drawing down, they will draw more and then get taxed on it then?