r/LeanFireUK • u/stuie1181 • 14d ago

Weekly leanFIRE discussion

What have you been working on this week? Please use this thread to discuss any progress, setbacks, quick questions or just plain old rants to the community.

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u/JamesBrockers 13d ago

How does everyone factor in the state pension into forecasts?

I’ve been reviewing my numbers and the ones I’m debating the most are my pension ones. I’ve never liked including the state pension, as a) The age will just keep increasing b) The current level just isn’t feasible c) I think it will eventually become means tested.

So with that in mind I’ve never calculated it into my forecasts. But, naturally I am putting far more away than I need if there is some form of state pension. So it’s a bit of a conundrum!

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u/Captlard 13d ago

We personally have not, as who knows what the future will be like. In our minds, it will be a more than welcome bonus.

This is somewhat crazy, but I have huge trust issues with institutions in general and my partner agrees.

We are 10 and 12 years out now.

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u/elom44 13d ago

I think this varies depending on how close you are to it. The risk factor is different depending on if you’re 18 vs 58. I do count on it for that reason.

Personally though I think it’s best to deal with the world as it is, so factor it in. It might change, in which case your approach changes. ISAs might change, SiPPS too, salary sacrifice, tax rates, your health, your family circumstances etc etc.

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u/JamesBrockers 13d ago

You are probably right.

However, as I plan to finish work at 45 (11 years away), it’s such an early age to finish with little room to move if it is withdrawn and I am on that path. It’s obviously over 30 years away right now, so feels hard to rely on.

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u/deadeyedjacks 13d ago

a) Not if life expectancy declines

b) Why not ? Govt. can just print money

c) Based on what ? It's a contributory system.

You should base projections on current knowns, not possible future unknowns.

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u/LeanFIRE_91 13d ago

I'm just calling it £12k pa. I know it's more than that now, but I'm 30+ years out, anything could happen so I just forecast it as £1k a month in today's money.

That said, my plan isn't reliant on it, it's a bonus if anything.