# how much per month do you contribute to your pension?



## bling25 (24 Sep 2008)

had pension review with bank yesterday and they advise that we increase our payments, both myself and my husband have our own pensions. 

we are currently paying 100 euro each in and i know myself thats probably too low as we set it up a few years ago and now we are in a much better financial position but yet i'm not sure if we should be paying in quite as much as they suggest.

 they recomend a % of salary and they say 600 euro for my husband and 320 euro for me? is this too much? he is self employed and i work for him and our business can afford to pay that amount but i dont want to waste money either as so unsure of pensions at the moment, and wonder if we would be better putting the extra bit they suggest into a post office saving cert or similar (i know we would lose out on tax benefit from government but even without that i feel our money would be safe).

 we also will have our mortgage paid in a few years so its not like we need a massive income when we retire. would love to hear what is the average contribution? thanks


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## ClubMan (24 Sep 2008)

bling25 said:


> would love to hear what is the average contribution? thanks


Pointless exercise in my opinion. The absolute amount will depend so much on personal circumstances that it will be meaningless to generalise from it. Better to look at your own overall financial situation, how much you can afford to contribute and what your target pension lump sum/income target might be and then make decisions appropriate to your own specific circumstances rather than looking at what others are doing.


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## dieseldave (24 Sep 2008)

€137 a month for me , your right it is a percentage... but only recommened, don't by signing the dotted line because the sales rep is saying you have to and he reaping a big commission on you. Do whatever you can afford.


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## NicolaM (24 Sep 2008)

Also, just be aware that your bank will not be giving you impartial advise.

Nicola


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## LDFerguson (25 Sep 2008)

Nobody can tell you whether or not €600 or €320 per month is too much because it's all relative to your income and lifestyle.  If you're earning €2,000 per month between you, it's too much.  If you're earning €20,000 per month, it's probably too little.  

Ideally you should at least avail of the higher rate tax relief to the full extent, but only if you have other shorter term needs and goals already under control, e.g. unsecured loans, credit cards, school & college fees etc.  

As regards being unsure of pensions at the moment, there are plenty of funds to choose from that can match your own risk profile, from deposit funds to high-risk geared equity funds.  Rather than throw the baby out with the bathwater, I'd suggest you find a pension fund that you're comfortable with.  

Before signing on the dotted line, make sure that you are aware of how much out of each contribution is actually going into your fund and how much is being deducted in charges.  Uncompetitive charges can have a huge impact on your pension fund and can easily be avoided.  Ask the bank to detail all the relevant charges and post them here - you'll get plenty of opinions as to whether or not they're competitive.


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## tiger (25 Sep 2008)

Some rough rules of thumb are:
You'll need a pension of somewhere between half & 2/3rds your final salary.
Pension contributions = half your age as a % of salary. (roughly 10% in your twenties, 15% in your thirties etc.).
As has been said, depends on your specific circumstances and needs.


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## ClubMan (25 Sep 2008)

tiger said:


> Some rough rules of thumb are:
> You'll need a pension of somewhere between half & 2/3rds your final salary.
> Pension contributions = half your age as a % of salary. (roughly 10% in your twenties, 15% in your thirties etc.).
> As has been said, depends on your specific circumstances and needs.


I'm also skeptical about such rules of thumb to be honest.


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## daraghom1 (26 Sep 2008)

I'm skeptical on this too. The most basic rule is always put in what you can afford... it also depends on whether you have any other assets, ie a rented apartment etc

You can get some rough calculation figures on Irish Lifes website.


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## theoneill (26 Sep 2008)

Given the current market turmoil would it not be worth taking a pension holiday and pocketing the extra cash only to resume when the markets stabilise?
Or would that be foolish?

 I only say because in my statement my pension fund took a mauling and I could probably use the extra cash that I would free up.


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## ClubMan (26 Sep 2008)

Some clichés which might be apposite:

Timing the market is a mug's game. 
It's time in the market and not timing the market that's important.


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## DerKaiser (30 Sep 2008)

Depends on how much you want at retirement.  

Speaking in terms of current prices:

Saving €100pm from age 30 to 65 will probably provide a pension of €200pm in retirement.  

Say you want a retirement income of €30k p.a.  If we assume the OAP will continue to be around €10k p.a., you'll need to fund for €20k p.a.
This could involve putting away €10k p.a. or €800pm before tax.

I think people probably don't grasp the cost of purchasing a retirement income and there is still a belief that they'll make free money from equity investment.


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## GetMoving (1 Oct 2008)

Is there a really good online calculator for pensions? I'm thinking of the equivalent of Karl Jeakle's mortgage calculator. 

Irish Life (who my company PRSA is with) give you a fairly good guide to what monthly contributions are required to give you a % of your current salary [broken link removed]. IMO, comparing it to It's Your Money and several others I've looked at, it's about the most straighforward available. 

I'd be interested to hear what others think.


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## ClubMan (1 Oct 2008)

Anything here?

A Compilation Of Useful Links


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