21st August 2006, 12:37 PM
Tom,
Its tough but not quite a tough as you think.
Remember that you get the tax back on pension contributions and that compounding takes effect.
If you needed to save 1 million quid over 30 years and the average return was 5 % then that equates to around 14700 pounds per year.
If the average return was 8 % ( not impossible ) the the amount you need to save is 8000 pound per year, from GROSS salary
OK, so this is still a lot of dosh from a low salary so save 4000 a year in a pension and get 24k a year in 30 years time instead. Its got to be better than poverty in your old age.
I should add here that I have reseached private pensions in detail for my own purposes BUT I AM NOT qualified to give financial advice.
I do however recommend that you seek advice and start some kind of saving for retirement.
Its tough but not quite a tough as you think.
Remember that you get the tax back on pension contributions and that compounding takes effect.
If you needed to save 1 million quid over 30 years and the average return was 5 % then that equates to around 14700 pounds per year.
If the average return was 8 % ( not impossible ) the the amount you need to save is 8000 pound per year, from GROSS salary
OK, so this is still a lot of dosh from a low salary so save 4000 a year in a pension and get 24k a year in 30 years time instead. Its got to be better than poverty in your old age.
I should add here that I have reseached private pensions in detail for my own purposes BUT I AM NOT qualified to give financial advice.
I do however recommend that you seek advice and start some kind of saving for retirement.