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Saturday, March 10, 2012

Looking forward to penury

You know it is a bad time for pensions when even the Metro carries a story about the depletion of our pension savings.
Metro, by the way, is usually the one paper I strive to avoid in the morning, given that it usually only contains terribly depressing stories about children kicking ponies in the head or grandmothers sleeping with their progeny’s boyfriends - hardly the encouraging kind of get-to material one should read when going to work.
It’s so bleak sometimes I want to give up before I even get to the office.
But today, I wanted to get to the office to check my own pension savings. I’m afraid I’m one of those who have several small DC pots and one or two deferred DB pots left untouched. I intend to leave those DB pots untouched but to merge the three DC ones into my current scheme in the clutch-at-straws hope that by the sheer power of accumulated force, any incremental rise in interest rates/performance of the funds might be accelerated by having that additional £5k.
When I read that DB liabilities jumped £133bn in February alone, however, the safety of my old DB pots also looks miserable. And to think I dared to sign up for a company pension the very day I joined my first employer, Reed Elsevier Butterworths Tolley Et Al (as it was then, more or less) way back in 1999.
Was I really wrong? Jeff Prestridge, our esteemed columnist, has for many years extolled the virtues of Isas to augment - and perhaps even replace - traditional pension pots. I have an Isa too, of course - 10 per cent of salary to pension/Isa, 10 per cent to charity, the rest on the mortgage and the darn cat. That’s what I always believed.
But even with the wondrous Broughy of Schroders boosting my long-term Isa savings and cash, well, doing bleep all, I’m not exactly going to roll in the lap of luxury with this little bunch.
Now it seems with an estimated shortfall of 40 per cent I need to boost my own savings considerably. Perhaps even make it 25 per cent, 30 per cent of my monthly income. On my salary and with my bills, mortgage and travel expenses, that seems barely reasonable.
I’m pretty boring - I don’t drink, I don’t go out clubbing and my taste in clothes is so avant-garde that I pretty much hate, loathe and detest clothes shopping. But even if I squeeze a few more pence out of my salary, will any of it make any difference in the long-run?
We might not even have pensions by the time I come to retire which, it seems, will be a few weeks before I die - at least I won’t have to worry about long-term care costs, as I will be in my grave.
The only sniff of help might be from the fact that I have a property, although I am getting worried about my windows, my ceiling, rising crime (not in my property, although that could be a way out of my personal pensions crisis .... perhaps granny-crims will be on the rise... ) and a million other things to worry about, not least the fact the leaseholder of the flats has gone awol, just when I wanted to buy back some years on my lease.
I’ve forgotten my thread. Oh yes, so basically my Isa savings are pitiable, my pensions are pitiful and my retirement prospects are the pits. Well this is cheery.
I should never have read the paper this morning. Next time I board the 8:50 to London Bridge I’m going to get a copy of the Metro and shove it up, well, maybe I’ll be too depressed to do any shoving. Perhaps I’ll start collecting them and store it as fuel for when I’m 75.


Gorilla Bananas said...

Saving 10% of your salary and paying off a mortgage sounds fine to me, Mermaid. Who's been doing your calculations? These IFAs have a vested interest in persuading you to take out more policies.

Next time you pick up the Metro, only look at the snippets of quirky news. They've inspired half my blog posts!

john.g. said...

Hi, Merms! I know it sounds wrong/sick, but, since I collected the compensation after my accident, I am finacially sorted
Oh, and i wasn't a tax payer claim! xx

Electro-Kevin said...

You could always marry someone with good prospects.

Retirement plans. It's a difficult issue is it not ? But at least you're thinking about it. That means you'll find a solution and there's still plenty of time.

Hey ! You have dual nationality don't you ?

I know your Ma is precious to you, however, the longer term may offer you wider horizons for opportunity than the average.

(Have you thought about joining forces with your Mum btw ?)