Tuesday, 5 May 2015

Is Pension a Dirty Word?

Make sure the children aren't reading over your shoulder as I am about to use two very dirty words, repeatedly.  Retirement.  Pension.  Did you shudder?  You're not alone.  As retiresavvy, the new website portal from Skipton Building Society, says:

Planning for retirement is a bit like going to the gym. Everyone knows it’s a good idea; but in practice, actually finding the time and motivation to do it can prove tricky.

Living a fairly hand-to-mouth existence, we have very little cash spare at the end of each month and, currently, anything we do have is going into the new car fund.  But pension planning is something we should think about as we are both in our forties and neither of us have made any pension provision really.  It was interesting to see what advice retiresavvy gave people like us, as you are so often given the impression that once you get to 40 there's no point even starting a pension pot - you have already failed!

One of the most important things for parents who may have taken time off to look after young children, or reduced to part-time hours, is to make sure that your National Insurance contributions reflect that.  If you are the person that receives Child Benefit then you can request that your child-rearing years be taken into account for the 35 year pay-in requirement, and will therefore keep your state pension safe at 100%.

I'd already done this, thankfully, especially as I started paying NI at the tender age of 16!  But making me think about retirement and pensions did prompt me to dig out my old teacher pension, and I even found an old private one I had started in the 1990s and entirely forgotten about.  Neither of them will enable me to retire to a Mediterranean yacht, but it's certainly nice to know there will be a little top up to the state's offerings when the time comes.

Having always worked in the poorly paid and benefit-free catering industry, Steve is even worse off than me, but hopefully we will find some way to muddle along together in our old age.  I don't think he still wants to be cooking then!  Our life will be further complicated by the fact that Tatiana will be of university age when we are in our early 60s, and we will hopefully still have one or more girls living with us.  This is a whole new way of living life, we did our partying and travelling at the beginning, not the end, and we will probably be quite happy to work in some capacity and live differently when we reach the traditional retirement age.  It would still be nice to know we are provided for though, of course.

What about you, what do you think your 'retirement years' will look like?  Have you started planning for retirement yet?  Skipton's retiresavvy aims to demystify the pensions market with all its (seemingly ever-changing) rules and regulations, and it offers a range of ideas and solutions for those planning for retirement, even from the earliest age, and for those for whom retirement is fast-approaching or a current reality.  I was really impressed wiht the range of information the site covers, although I did find the interface a bit clunky and the site isn't the easiest to navigate.  Hopefully these blips will be cleared up soon.

The site offers a wealth (sorry!) of information and there are articles related to many aspects of retirement, both personal and financial,a nd the Frequently Asked questions section is full of very interesting information.  Although the statistic that the average person over 55 has outgoings (housing, utilities, food, essential[?] motoring costs) of £1,357 a month is mind-blowing to me, we don't even spend that now for a family of 5!  However, their stories from real retirees prove what we all know already: retirement ain't what it used to be!  We're all wearing purple these days (Google it).

My mum will be 76 this year, and although she has recently begun to slow down more, I think this is because she is telling herself she is 'old' as much as anything else.  Before this, she worked in secondary education until she was over 70, took holidays to Ibiza (including skinny-dipping!), sang and danced with Chico long before he hit the UK; travelled parts of the US and Russia; and came home drunk more nights than I ever did!  Who says life ends at 60?!  And, as I mentioned above, our style of living is probably going to be very different again.

I did find the financial information on the site useful, but I felt that lot of the advice on coping with retirement was meant for people who work a regular job for 40-odd years then retire and have endless days of nothingness stretching before them.  I'm not sure how many younger people this really applies to these days, so perhaps the case studies and advice will change over time to reflect this.

Of course, whatever our age, we should all be giving some thought to retirement provision.  And perhaps it is better to start a pension pot in your early twenties, but with £20K of student debt on their shoulder, I'm not sure how many young people will be able to do that.

As for me, apparently I should be retiring at 67*, or at least I will start receiving a state pension then.  Just as well I'll have all these children paying into the tax pot!!  But really my job is rather different to the norm anyway, and who knows where the digital world will be and what roles there will be in 20+ years time.  In the meantime, I'm afraid the only saving I can afford to do is for that 7-seater, the pension will have to wait.

If you are in a better savings position than us, do make sure you have a look at the retiresavvy site for lots of inspiration, advice and tips.  Their FAQs is a great place to start.

* Those born after 6 April 1977 will start receiving the state pension at age 68.

I was asked to review retiresavvy.skipton.co.uk by Skipton and the Mumsnet Bloggers Network. All views are my own. I was entered into a prize draw to win vouchers as a token of thanks for blogging. View other blogs on this topic here: http://www.mumsnet.com/ bloggers/retiresavvy-portal- what-our-bloggers-thought-

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