marathonic
Registered User
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The current minimum wage is €17,992 per year. To achieve this via a private pension by age 68, you'd need the following contributions:
Assumptions:
Growth After Charges: 6%
Inflation: 2.5%
Growth After Charges and Inflation: 3.5%
Annuity Rate at retirement: 5%
Pension Pot required at retirement: €359,840
Total Contributions Required
Starting at age 20: €251.77
Starting at age 25: €314.24
Starting at age 30: €396.93
Starting at age 35: €509.51
Starting at age 40: €668.80
Starting at age 45: €906.85
Obviously, you should be able to survive on less than minimum wage if you have your mortgage paid off and you'd be very well off if you achieved a minimum wage private pension and the state pension still existed when you retire (something I'm not willing to bet on).
The above is just an illustration to show that, whilst it's better than nothing, someone contributing €50 per month (3% of a €20,000 salary) probably isn't doing enough, even if they do so at 20.
Also, the above are total pension contributions - it won't cost you this much because you'll receive tax relief and, potentially, employer contributions.
It's also worth noting that the above growth rates are probably a little optimistic - especially if your pension has high charges.
Assumptions:
Growth After Charges: 6%
Inflation: 2.5%
Growth After Charges and Inflation: 3.5%
Annuity Rate at retirement: 5%
Pension Pot required at retirement: €359,840
Total Contributions Required
Starting at age 20: €251.77
Starting at age 25: €314.24
Starting at age 30: €396.93
Starting at age 35: €509.51
Starting at age 40: €668.80
Starting at age 45: €906.85
Obviously, you should be able to survive on less than minimum wage if you have your mortgage paid off and you'd be very well off if you achieved a minimum wage private pension and the state pension still existed when you retire (something I'm not willing to bet on).
The above is just an illustration to show that, whilst it's better than nothing, someone contributing €50 per month (3% of a €20,000 salary) probably isn't doing enough, even if they do so at 20.
Also, the above are total pension contributions - it won't cost you this much because you'll receive tax relief and, potentially, employer contributions.
It's also worth noting that the above growth rates are probably a little optimistic - especially if your pension has high charges.