Thrifty Living: Do Yourself A Favour And Sort Out A Pension

Oh God. Saving for pensions. The only people in my household who actively save wear Dora the Explorer Pull-Ups. Who really saves any more? The minute hard cash hits my account, it ricochets off into a) the overdraft, b) childcare payments and c) credit card repayments.

And why give money to ne'er do wells? When the Turner Report came out this week, this apposite comment was made on the BBC's website from one Kyle R; "Perhaps if pensions were safe from greedy politicians it would encourage more of us to save." Remember Captain Bob? I would rather hand prospective retirement cash to a smoothie from the estate agent Foxton's than a smoothie from the City, which is why property is still such a popular option, and investing in pension schemes is not. Remember Equitable Life?

However, as I am hoping to lead us all, via this column, to a land of thrifty living, I cannot advocate burying one's head in one's multitudinous debts. Since I came clean about my £40,000 overdraft, I have pledged to live a better life. To use a Radio Two analogy, I have reversioned "Lady in Red", and have started wandering about humming "Black is Black", which is a far cooler song, as well as being an actively positive guide to the steps I am taking towards that rare domain, namely a current account in credit.

But if a better life is to be taken, a proper pension scheme must be embarked upon. And if you do it with continuity, that growing nest-egg will make you feel virtuous. It's a pricey, but healthy option, like snacking on a tub of Food Doctor Seeds. What's the best way?

Like many of us, I have long thought of the equity on my house as equivalent to a pension. I was encouraged to focus on capital by the unlikely figure of the editor of the BBC's Ten O'Clock News. When I was arts correspondent, he pulled me into an office, ostensibly to talk about a piece on Cameron Mackintosh. To my amazement he suddenly started bewailing his personal finances.

"You'll never earn enough to live on by working here," he said to me, sadly. "The only money I have ever made is from my house."

So I started watching house values. Eventually I noticed they had gone up rather a lot. So we remortgaged, and bought a little flat to let, and another, and another. Even when galloping growth slowed, property still looked like the best way of accruing something for a distant future when you might be in Dora the Explorer Pull-Ups.

But what if there is a property crash? As a freelance, I have no pension. I have an old BBC pension which might provide enough for my subscription to the New Yorker. Lots of us are similarly reliant on property, cut with a dash of optimism. Some of us vaguely hope our children will look after us. Why do you think I, a mother of four, have had so many?

Yet the Turner Report might bring us to our senses. As people who know a lot about finances say, you must spread your load and get into investments (rather than offspring). Bonds, Gold, Equities. I suspect a lot of us will never get round to doing half of this. But if Turner's National Pensions Savings Scheme arrives and enrols you to contribute 5 per cent of your earnings, post-tax, into a pension pot, something might start. If you work for a company, you will have another, no matter how small.

Four per cent is all it takes. The Government will give 1 per cent, through tax relief or credit. I am a huge advocate of automatic payments, since losing money when unconscious is far less painful than coughing up when awake. It's apparently known as "soft compulsion". Set it up, forget it, and come your 68th birthday it will be like a welcome present from a far-distant relative.

cashl@independent.co.uk

Independent Partners; request a free guide on NISAs from Hargreaves Lansdown

PROMOTED VIDEO
Arts and Entertainment
Standing the test of time: Michael J Fox and Christopher Lloyd in 'Back to the Future'
filmReview: A week late, Secret Cinema arrives as interactive screening goes Back to the Future
Travel
travel
Arts and Entertainment
Sydney and Melbourne are locked in a row over giant milk crates
artCultural relations between Sydney and Melbourne soured by row over milk crate art instillation
Arts and Entertainment
Adèle Exarchopoulos and Léa Seydoux play teeneage lovers in the French erotic drama 'Blue Is The Warmest Colour' - The survey found four times as many women admitting to same-sex experiences than 20 years ago
filmBlue Is The Warmest Colour, Bojack Horseman and Hobbit on the way
Arts and Entertainment
Preparations begin for Edinburgh Festival 2014
Edinburgh festivalAll the best shows to see at Edinburgh this year
News
Two giraffes pictured on Garsfontein Road, Centurion, South Africa.
i100
News
Kenny Ireland, pictured in 2010.
peopleBenidorm, actor was just 68
Environment
View from the Llanberis Track to the mountain lake Llyn
Du’r Arddu
environmentA large chunk of Mount Snowdon, in north Wales, is up for sale
News
i100
Arts and Entertainment
arts + ents
News
Morrissey pictured in 2013
people
Finacial products from our partners
Property search
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Money & Business

    Regulatory Reporting-MI-Bank-Cardiff-£300/day

    £200 - £500 per day + competitive: Orgtel: I am currently working on a large p...

    Trainee Recruitment Consultant - Birmingham - Real Staffing

    £18000 - £23000 per annum + Commission: SThree: Real Staffing are currently lo...

    Training Programme Manager (Learning and Development)-London

    £28000 - £32000 per annum + benefits: Ashdown Group: Training Programme Manage...

    Operations Engineer (Redhat, UNIX, Solaris, Data Centre, Cisco)

    Negotiable: Harrington Starr: Operations Engineer (Redhat, UNIX, Solaris, Data...

    Day In a Page

    Dress the Gaza situation up all you like, but the truth hurts

    Robert Fisk on Gaza conflict

    Dress the situation up all you like, but the truth hurts
    Save the tiger: Tiger, tiger burning less brightly as numbers plummet

    Tiger, tiger burning less brightly

    When William Blake wrote his famous poem there were probably more than 100,000 tigers in the wild. These days they probably number around 3,200
    5 News's Andy Bell retraces his grandfather's steps on the First World War battlefields

    In grandfather's footsteps

    5 News's political editor Andy Bell only knows his grandfather from the compelling diary he kept during WWI. But when he returned to the killing fields where Edwin Vaughan suffered so much, his ancestor came to life
    Lifestyle guru Martha Stewart reveals she has flying robot ... to take photos of her farm

    Martha Stewart has flying robot

    The lifestyle guru used the drone to get a bird's eye view her 153-acre farm in Bedford, New York
    Former Labour minister Meg Hillier has demanded 'pootling lanes' for women cyclists

    Do women cyclists need 'pootling lanes'?

    Simon Usborne (who's more of a hurtler) explains why winning the space race is key to happy riding
    A tale of two presidents: George W Bush downs his paintbrush to pen father’s life story

    A tale of two presidents

    George W Bush downs his paintbrush to pen father’s life story
    Restaurateur Mitch Tonks has given the Great Western Pullman dining car a makeover

    The dining car makes a comeback

    Restaurateur Mitch Tonks has given the Great Western Pullman dining car a makeover
    Gallery rage: How are institutions tackling the discomfort of overcrowding this summer?

    Gallery rage

    How are institutions tackling the discomfort of overcrowding this summer?
    Louis van Gaal has £500,000 video surveillance system installed to monitor Manchester United players

    Eye on the prize

    Louis van Gaal has £500,000 video surveillance system installed to monitor Manchester United players
    Women's rugby: Tamara Taylor adds fuel to the ire in quest to land World Cup

    Women's rugby

    Tamara Taylor adds fuel to the ire in quest to land World Cup
    Save the tiger: The day America’s love of backyard tigers led to a horrific bloodbath

    The day America’s love of backyard tigers led to a horrific bloodbath

    With only six per cent of the US population of these amazing big cats held in zoos, the Zanesville incident in 2011 was inevitable
    Samuel Beckett's biographer reveals secrets of the writer's time as a French Resistance spy

    How Samuel Beckett became a French Resistance spy

    As this year's Samuel Beckett festival opens in Enniskillen, James Knowlson, recalls how the Irish writer risked his life for liberty and narrowly escaped capture by the Gestapo
    We will remember them: relatives still honour those who fought in the Great War

    We will remember them

    Relatives still honour those who fought in the Great War
    Star Wars Episode VII is being shot on film - and now Kodak is launching a last-ditch bid to keep celluloid alive

    Kodak's last-ditch bid to keep celluloid alive

    Director J J Abrams and a few digital refuseniks shoot movies on film. Simon Usborne wonders what the fuss is about
    Once stilted and melodramatic, Hollywood is giving acting in video games a makeover

    Acting in video games gets a makeover

    David Crookes meets two of the genre's most popular voices