Retirement calculations - Can I ever retire ?

[BoldonLad]

So if you'd put it in your pension, it would have been tax free.

While not disagreeing with the idea of Pension Contributions, the "tax thing" is a bit of swings and roundabouts (IMHO).

With Pension Contribution, you get tax relief on the Contribution (within limits), but, pay tax on the Pension, when paid. You could, instead, invest in Stocks and Shares ISAs (with taxed money), and, hopefully, withdraw the rewards at Pension time, tax free.

My personal choice was, a bit of each.

 

[SkipdiverJohn]

the idea of Pension Contributions, the "tax thing" is a bit of swings and roundabouts (IMHO).
With Pension Contribution, you get tax relief on the Contribution (within limits), but, pay tax on the Pension, when paid. You could, instead, invest in Stocks and Shares ISAs (with taxed money), and, hopefully, withdraw the rewards at Pension time, tax free.
My personal choice was, a bit of each.

If you use your loaf though, you can make sure you keep out of the 40% tax bracket whilst you are still working, then minimise your taxable income when taking your pension by having the max 25% lump sum out. You could then invest your tax-free lump sum in high dividend-yield shares within a stocks & shares ISA, and receive the investment income tax-free. I also do both pensions and ISA's, but not cash ones as the returns on cash are shite.

 

[screenman]

I do not mind paying tax, just wish everyone else paid as well.

 

[BoldonLad]

If you use your loaf though, you can make sure you keep out of the 40% tax bracket whilst you are still working, then minimise your taxable income when taking your pension by having the max 25% lump sum out. You could then invest your tax-free lump sum in high dividend-yield shares within a stocks & shares ISA, and receive the investment income tax-free. I also do both pensions and ISA's, but not cash ones as the returns on cash are shite.

Quite,

although I did not spell it out, that was pretty much my technique (the 40% tax bit).

The second point depends on the amount of the lump sum, there is a limit on how much you can pump into an ISA in any one (tax) year.

Agree re; Cash ISAs, yjey always appeared pointless to me, even more so now, with current rules on taxation of interest.

 

[fossyant]

Whenever I see 'FACT' at the end of a sentence, I am always assured that the person using it has done extensive peer reviewed research and is entirely correct.

I work with a few thousand, so have experience.

 

[dodgy]

I work with a few thousand, so have experience.

Fair one. It's just one of those trigger phrases used by a certain section of society like "end of" and "fact".

 

[SpokeyDokey]

If you use your loaf though, you can make sure you keep out of the 40% tax bracket whilst you are still working, then minimise your taxable income when taking your pension by having the max 25% lump sum out. You could then invest your tax-free lump sum in high dividend-yield shares within a stocks & shares ISA, and receive the investment income tax-free. I also do both pensions and ISA's, but not cash ones as the returns on cash are shite.

I really do wish that was true. From the end of the 90's to early 2000's I was hammered on tax - it was just not possible to avoid higher tax rates although there were opportunities to minimise it.

 

[DCLane]

You don't need to think it, most haven't, FACT.

Erm ...

Whenever I see 'FACT' at the end of a sentence, I am always assured that the person using it has done extensive peer reviewed research and is entirely correct.

I work with a few thousand, so have experience.

But you don't work with me However, given I keep buying bikes that may have answered itself.

My retirement plan has me going part-time from academic at 60 having paid a full term into the Teacher's Pension scheme (which is a decent one), with several 'alternative' pension support plans.

 

[fossyant]

Erm ...

I've met you, you passed. There is about 10% with comon sense !

 

[JtB]

We’ve always been a single income family, but with careful planning and living within our means the mortgage was paid off over 8 years ago and at the age of 59 we now have significant savings along with 34 years paid into good pension schemes (including 30 years into a final salary pension). I could easily retire now if I wanted, but I enjoy too much what I do and so I’m in no hurry. I also enjoy the fact that I’m now working because I want to rather than because I need to pay the bills.

 

[screenman]

We’ve always been a single income family, but with careful planning and living within our means the mortgage was paid off over 8 years ago and at the age of 59 we now have significant savings along with 34 years paid into good pension schemes (including 30 years into a final salary pension). I could easily retire now if I wanted, but I enjoy too much what I do and so I’m in no hurry. I also enjoy the fact that I’m now working because I want to rather than because I need to pay the bills.

We have also been a single income family, bit of a rarity.

 

[Gunk]

We have also been a single income family, bit of a rarity.

So have we, my wife never went back to work, we’ve managed fine.

 

[screenman]

So have we, my wife never went back to work, we’ve managed fine.

We got married aged 17 and 18, 45 years ago, single income since then.

 

[Drago]

Between me and Mrs D we have so many income streams it's hard to keep track. My pension, my injury award, rental income, Mrs D's pension, Mrs D's salary, Mrs D's PIP, Mrs D's business interest, all bringing in moolah on different days of the flipping month. Fortunately daughter #3 is an accountant and keeps tabs on that for me.

Still no new Bentley though

 

[screenman]

Between me and Mrs D we have so many income streams it's hard to keep track. My pension, my injury award, rental income, Mrs D's pension, Mrs D's salary, Mrs D's PIP, Mrs D's business interest, all bringing in moolah on different days of the flipping month. Fortunately daughter #3 is an accountant and keeps tabs on that for me.

Still no new Bentley though

I also never got a Bentley, did have nice Roller for a while though back in my more stupid younger days.