Panicking about pension

[hulahoop09]

Hiya

Okay so I am 30 next year and have never put into a pension due to not being in a secure job I was happy in (likely will change in future also) and not being able to afford it. I plan on putting into one from next year (I put £40 and employer puts approx £70) when money is a BIT better. Hubby doesnt pay into one either for same reasons and he still isnt happy in his job and as I said we havent been able to afford it. We have a mortgage of which will be paid off by the time I am 50. I plan on working as long as I can as I know I cant retire early if at all. Lol. I know me putting £40 per month into a pension isnt much but its better than nothing surely! Also we need to sort one out for hubby at some point in future. We just dont want to break ourselves again and not be able to enjoy life here and now (not meaning to be morbid but you never know when it may end) with our daughter (and a child we plan on in approx 4 years).

It is likely the retirement age will go on til I am dead anyway and I reckon I will always work (even if only part time).

Anyone else worry about a pension but at the same time trying not to let it worry you too much?

Does anyone know if I started paying into one and changed jobs in the future what would happen to it?


xx

 

[Mummy2B21]

Not sure hun i have money to secure my future so i plan buying a second home in.my olden years and renting it out ive never paid into a pension either i honestly think saving yourself also is the way forward.

 

[hulahoop09]

Thats fab. We have our mortgage which will be paid by the time I am 50 but thats it. We arent in big paid jobs and likely will never be so I jst dont know how it will all work. We are not poor and not well off so kinda screwed I guess. Lol. Xx

 

[LPF]

The thing with pensions is it is harder to pay into them as time goes on because you'll always miss the money!

Although your mortgage will be paid off, I guess you'll have to think about selling the house to pay for your retirement.

Maybe think about how much money you may need to live off with no mortgage, just bills etc in your retirement and see if the state pension covers it.

You'll only really get good pensions in terms of payout if it's an employer contributed and have been paying in for a reasonable time.

Personally I'd want to pay into one (and do). I work in the nhs and see the vast proportion of people in their late 80s and 90s struggling with money and require social assistance. Remember you may retire at 70 but still live for 25 yrs more and need to pay for assisted living etc.

 

[Pearls18]

This is something that worried me when I was 23 (baring in mind my parents have been paying since they were 16!) when I got back into employment I really really could have done with the money but at the end of the day, unless you do have other sources of income, pension is a vital thing and not really an option in my view. I have always worked in the public sector so it is worth doing, when I change jobs it just gets transferred, as it's taken out of my wages I don't think of it as missing income, more another form of tax. My husband has a military pension so he is set up, il try and keep hold of him haha.

 

[hulahoop09]

See thats really lucky if you have had the money etc but I havent been in a situation to etc.

Yes it is likely we would have to sell the house but then we would have to pay rent on a council place so would we not be in a kind of worse situation? Its so frustrating knowing what to do as yes I will start paying say £40 a month into a pension from next year and my employer will pay approx £70 per month. Hopefully I can continue to work past retirement as I cant see us being able to retire due to money. Its a nightmare and very confusing knowing whats best. Obviously paying into a pension is and I will be when I am 30 but then we are paying our mortgage which as I said will be cleared and say we have to sell when we retire and it is worth say £100k but as I said we will then have to pay rent on somewhere And will be sad to see the house go that we lived in when we got married, had children etc.

I am so stuck as to how we will afford to live if we have to retire. We will deffo have some sort of retirement pot (hubby will have to start paying in the next few years also) + state pension IF it is still going which is unlikely. I am considering when we are old, selling the house and then buying a caravan on a site somewhere and living there!! Haha. Will have some money left over and our home paid for so will just be bills and site fees for the site.

Whats a reasonable amount of time? Also what if you need assisted living when you are old but cant afford it out of what you get each month from work pension?

I am really really worried now about how we will manage when we are old!

xx

Added: I guess an option is when out mortgage is paid off at 50 then the £500 we used to spend on then we could save it towards our retirement? So say IF I retired at 70 I would have approx £53k in my pension (hubby I dont know what he would have in one atm) and we would have approx £120k from our mortgage savings (obviously we have to pay tax etc on that but I dont know how that works)

 

[Mrs.S.]

if you were thinking of selling your house to pay for your retirement another option could be to release the equity in it - that way you would be give the market value cash for your house but you would also be give life rent in it so the company would only get it once you and your partner had passed away (so again it would just be bills to pay not rent/mortgage).

If you required assisted living in old age you would be assessed and partly funded by social work - again if you don't own your house (which if you released the equity you wouldn't) you would receive more funding for this from social work. if you own your house it would be likely that they would make you take the money out of the house (sell it) to pay for your care so making sure that you don't own/house is not in your name in old age is in your best interest with the increase of life expectancy/illness in old age.

I think starting to pay into a pension and continuing to pay into savings what you would pay out in mortgage payments after you've retired is a good idea though.

Xx

 

[hulahoop09]

Thanks! The equity thing confused me. Lol. We put in approx 30k and took our mortgage for approx 80k (our property eas valued at 110k) but now they arent even selling for 92kish around here

Is it possible to sign the house over to our daughter so she owns it but we still live here if we needed to when we are in old age? Could we just give it her so she owns it outright if the mortgage is paid off?

xx

 

[LPF]

I don't know what the rules are about handing over houses - the government try to stop people doing things like that which they could get inheritance tax on later down the line! Your daughter might have to pay tax on it as an extra asset or something.

If you owned a house and one of you needed residential or nursing care you'd be expected to fund that as a homeowner.

If you start paying into a pension you'll be able to get a calculation of pension based on different ages of retirement. If you start paying in at 30 I'm sure it'll be fine.

I started my nhs one at 25 and based on retiring at 65 it was a decent amount. I pay £80 per month currently and then i get employer contributions too. I paid more for 6 years before I went part time.

The thing with pensions and retirement - the more you put in, the more you get out and it is difficult to prioritise that when you're younger.

 

[Mrs.S.]

yes it is possible to sign your house over to your daughter (at least it is in Scotland) however there would be a few costs involved (not sure how much) and you would have to do it well in advance of you or your husband becoming unwell/requiring any form of care for it to be disregarded as yours - I'm pretty sure its about 5-10 years prior to illness. This is the governments way of trying to ensure that not everyone gets away with this. so you would have to be prepared!

The equity scheme would release however much your house was valued at, at the time so its difficult to say what your house will be worth in 40 years time but a lot of my patients (I'm an OT in elderly care) do this in older age when they need care and use the money to pay for private 24hour care (or as much as they need) so that they can remain in their own home rather than go to a residential/care home.

I agree with the above poster though that you should definitely look into good pension schemes. Xx

 

[hulahoop09]

Thanks ladies. I work in a doctors surgery and from nxt yr I can afford approx 40 per mnth into my pension which is the minimum and my employer would put approx 70. O wpuld hope to put more in the future but as I said money certainly atm is tight and that 40 a month will make a difference but I understand why it has to go. Also when hubbybstarts paying into something that again will be missed. Lol.

The government suck ass and are really starting to annoy me! I just cant see whats best in that pay mortgage til 50 when its cleared then live rent free after but then risk if need residential care etc we would have to sell the house we have worled hard for to pay for it and then have norhing to leave tp our children! I could seriously cry!

Xx

 

[hulahoop09]

If we were to live in a private/council house/flat when we retired do you get any help towards rent? Also do the council get a council tax discount? All this is very much worrying me now about what best to do incase we dont have enough in pension when retire, at same time I can see us working til we die! Xx

 

[Mrs.S.]

I'm not sure about help towards rent or council tax. sorry - I do think that you are in quite a good position with tour house though. the fact that you will be mortgage free from 50 will mean that you could
potentially have a substantial amount of savings in old age as well as an occupational pension and atheists state pension. If you needed care, your savings would be used first before they looked at your house so hopefully it would be enough. don't forget that your pension contributions are taken off your pay before tax so you may not miss it as much as you thought.

You're still young enough to save and prepare for life in old age as best you can. No one knows what the future holds. I know its hard but try not to worry so much - your doing all you can to prepare! xxx

 

[hulahoop09]

Thanks! Yeah your right. If we saved our mortgage payments from when I am 50 for 20 yrs that would give us approx 120k savings thats obviously before we are taxed on it. Lol. Its all new to me as my parents have a council flat, no pension no.savings etc so I havent got a clue how it all works! I am 30 and guess I need to enjoy my young yrs! Lmao. Xx

 

[Pearls18]

Thanks ladies. I work in a doctors surgery and from nxt yr I can afford approx 40 per mnth into my pension which is the minimum and my employer would put approx 70. O wpuld hope to put more in the future but as I said money certainly atm is tight and that 40 a month will make a difference but I understand why it has to go. Also when hubbybstarts paying into something that again will be missed. Lol.

The government suck ass and are really starting to annoy me! I just cant see whats best in that pay mortgage til 50 when its cleared then live rent free after but then risk if need residential care etc we would have to sell the house we have worled hard for to pay for it and then have norhing to leave tp our children! I could seriously cry!
Xx

Unfortunately this is the way the cookie crumbles it happened to my parents' inheritance, people who have not saved up nor bought their own house will have their care paid for but those who have will lose what they have earned, but then I guess that is how the welfare system works wrongly or rightly, you are not alone in this situation, I hazard a guess most of us will be, but the truth is property will not automatically be enough which is why people have pensions and/or savings also. Do not assume because I paid into a pension I had the spare cash, back when I first gave in to paying into a pension we were in debt, my husband was unemployed, we were on housing benefit, I did not have 'spare cash' but as I say I see it as a neccessity, a tax sort of, I didn't see it as a choice and never will again, I don't want to be reliant on my children or the state when I am older I want a quality of life, so I pay into my pension, it is worth it in the public sector (still, just about lol). I wouldn't stress too much about paying for your care and things now, I would recommend carrying on with your pension, but who knows what will happen with elderley care when we are there, you might be able to take out insurance just for this purpose? But something will have to give because we are becoming an aged population.

 

[hulahoop09]

Thanks! I hadnt been in a secure job etc but I am in 1 i can stay in (would like change to teaching assistant in future but not sure if will happen). Hopefully we will be ok woth my pension worth approx 52k if i retire at 70 which I dont expect to happen lol. Not sure about hubbys pension. We could potentially have savings of approx 120k obviously will be taxed lord knows how much on that! And our house paid off. I am seriously considering buying a caravan! Lol. Xx

 

[Pearls18]

Pensions confuse the crap out of me, I have no idea where we will stand, I hope we will own by the time we are in our 30s, and the fact I have a public sector pension and DH a military pension we'll be alright but tbh I haven't done the sums....it's good you're thinking about these things and sounds like you'll be fine

 

[hulahoop09]

Thanks! We need to sort hubby ome but his work are rubbish, he is 1.5 yrs younger than.me so jopefully by time he is 30 at latest! lol. Awww that will be fab, will you own outright by that age?!

 

[Pearls18]

Thanks! We need to sort hubby ome but his work are rubbish, he is 1.5 yrs younger than.me so jopefully by time he is 30 at latest! lol. Awww that will be fab, will you own outright by that age?!

Nooooo lol, first time buyers then I hope lol, we get very cheap rent in the military and no point buying while we are moving around with hubby's career so probably won't own till then, no idea when we'd own outright but hopefully we'll have a sizeable deposit.

 

[hulahoop09]

Ah I see. We were lucky in that hubby had about 25k from grandma which he put into mortgage with his dad then we brought his dad out leaving 30k in house and taking mortgage for the other approx 80k (house was valued at 110k). Its a small house but i wanna stay there. Lol. Now they are struggling to sell round near us for 92k!! Xx