Victoria Jones knows she could build a large retirement pot through her job – but doesn’t have the spare funds to do so
In our new Pension Diaries series, we will be speaking to people of all ages in the UK to find out how much or how little they have saved for retirement and the realities of putting money aside for your future.
Today, we speak to Victoria Jones, 38, a married mum-of-one who lives in Birmingham and works as a university administrator.
She felt she had no choice but to stop paying into her generous university pension scheme when she became pregnant with her daughter, Hannah, as her family was too busy struggling to afford their everyday basics to worry about retirement.
Pension savings
Private pension: £250 in one pot and less than £2,000 in current pension
Ms Jones and her husband Ben have worked hard all their lives
What is your occupation and how much do you make?
Myself and my husband Ben both work full-time in support service roles at a university in Birmingham. I am an administrator and earn just under £30,000 and Ben is a porter and earns around £25,000 – so we have a combined income of £55,000.
When people hear I work for a university as an administrator, they tell me how lucky I am, as they know the pension scheme will be generous compared to most jobs.
It is a good pension scheme as the employer contribution is something like 10 or 12 per cent and it’s a defined benefit scheme – meaning it offers a guaranteed income for life.
This makes people even more astonished when they hear that I deliberately decided to stop paying into the university pension scheme when I became pregnant with my daughter Hannah, who is now four – but I had absolutely no choice as we just could not afford it and had cut back on everything else and the pension payment was the only other thing left that I could trim.
Even though the university pension scheme is good, that wasn’t a factor in me taking the job. I had been working in marketing and had been made redundant from my role, so I just needed a job.
Pensions were something that had always been at the back of my mind as being important, but I always thought of them as being something I would look at in the future and I never seemed to have the money to spare to put into one.
I have been working since I was 18 and at that age, I didn’t bother with a pension. I thought it would be something I would look at in my 30s, but then I hit my 30s, and cost of living was through the roof, and I then had my child, and unfortunately, I just couldn’t afford it.
How many pension pots do you have and what is your estimated total pot?
Before starting work at the university in March 2017, I worked in marketing, mostly at property companies. I only started a pension there when they made it compulsory when I was about 30.
I checked the other day and I only have about £250 in that pension pot, so in reality, I only have the one pension scheme which is the one at the university.
What is your biggest barrier to paying into a pension?
After starting at the university, I joined their pension scheme and I paid into it for about two years. But I stopped paying into it when I became pregnant, as there was no way we could afford it.
Ben has been working at the university since he was 17, so he has been paying into the pension scheme for a long time. At one point, we seriously considered stopping his pension payments too, so we could cover the costs of childcare, but he managed to keep paying in and it is reassuring to know at least one of us will have a decent pension pot.
When I first returned to work, my parents helped out with looking after Hannah, which was a massive help. But my dad was working part-time and my mum’s health wasn’t great, so we put Hannah into nursery.
It is only now she is four and has started school that I have started paying into my pension again. But I am only paying one per cent in as that is all I can afford.
The biggest barrier we face to paying into a pension is the everyday cost of living. We just have nothing to spare – it is ridiculous.
Ms Jones has only just started paying into her pension now her daughter is four and at school
What is your estimated total pension pot?
I don’t know how much I have in my university pension pot but as I have not been paying into it for very long, I know it won’t be any more than a few thousand tops.
The future does worry me a lot, as I know how important it is to prepare ahead. My parents always paid into a pension, and my dad actually accessed some of his pension early to help me and my brother out with a house deposit.
We are very lucky as we have a mortgage and live in our own three-bedroom semi-detached house, so hopefully, by the time we come to retirement, we will have some money in our home.
However, it is a horrible thought to know that by the time we get to that age, we might have to sell our home just so we can afford to live and free up some money.
What is your idea of a dream retirement?
In an ideal world, I would love to retire in my early 60s, but the reality is that is never going to happen.
I can’t see a point where we’re ever going to be able to stop working and I think even when we’re older, we’ll have to work part-time or reduced hours so we can have enough money to live on.
We worry that the state pension will disappear by the time we get there, or that they will keep putting the state pension age up, so by that point, we will be too old to enjoy our retirement.
My fear is that we’ll have to sell our house and rent in retirement and live a very basic life.
This feels incredibly frustrating, as I have worked since I was 18. We have always done the right thing and worked hard and it feels unfair to always be struggling.
We are like the squeezed middle. We earn too much to get any help, but don’t earn enough to live as comfortably as we would like.
My dream retirement would be to have the mortgage paid off and if we had grandchildren, spending time with them and it would be nice to have a holiday once a year. But I genuinely don’t see how that will happen.
It is a constant concern. We know how hard it has been to get on the property ladder, so what is it going to be like for our daughter? I would love to be able to help her out with a house deposit and childcare like my parents did, but if we have to work forever, that won’t be possible.
We have only had one child, as we could absolutely not afford another child at the moment.
What do you wish you had known or would change when it comes to pensions?
If I could change anything when it comes to pensions, I would say I would start paying into a pension earlier – but I know I could not have afforded to do so.
Maybe I should have achieved more qualifications and training so I could get a higher-paid role. Even now, I think ‘should I be putting myself forward for higher-paid roles?’ But with those comes a lack of flexibility and I would struggle with childcare and being able to pick up Hannah from school.
I am finally in a position where I can put a bit of money into my pension, but it is not very much. It is depressing to think that we face working forever and living a very basic hand-to-mouth lifestyle despite doing the right thing, working hard and always having a job.
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