Have a look at this to start off:
Age | % Chance of Reaching 85 | % Chance of Reaching 90 | % Chance of Reaching 100 |
---|---|---|---|
20 | 72 | 55 | 17 |
25 | 71 | 53 | 16 |
30 | 70 | 52 | 14 |
35 | 68 | 50 | 13 |
40 | 67 | 49 | 12 |
45 | 65 | 46 | 10 |
50 | 63 | 44 | 9 |
55 | 63 | 43 | 8 |
60 | 62 | 42 | 8 |
So, what's this all about? The data shown (from Life Foundation) tells you what you already knew: that it's likely that you'll live twenty-five to thirty years after retirement.
Funding yourself properly - not with State Pension baked beans - for that length of time is going to take SERIOUS action on your part; and that action should be taken as soon as possible.
I applaud those in their twenties who understand this and save even 50 Pounds a month (until they can do more), knowing that small amounts saved now stop bigger amounts having to be saved later.
Here's an anecdote, from many years ago in Dubai. Fred & Doris (names changed to protect the feckless) had 'enjoyed' 30 years in the desert but at last wanted to head home to Blighty. Retirement for Fred was two years away. They asked to see me. A review of their non-planning (they'd done precisely nothing) showed that to reach their monthly income goal in retirement would cost them around $5,000 a month MORE than Fred's salary. Obviously a bit of a downer. Luckily they owned a large home in the leafy suburbs. This was sold and a much smaller home bought, the difference going to an annuity (a viable option in those days), otherwise they would have been deeply in trouble.
Oh, but that was then! I wouldn't make the same mistake!
Really? You would be shocked at just how under-pensioned most people are.
Plan early, save less. Talk to me.
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