‘I’m 37 with £1,300 in my pension pots – I can only add £20 a month’
Small business owner Jenny Blyth is concerned about her financial future. By
Jenny Blyth is worried about the future. Although the 37-year-old has run her own business, Storm in a Teacup Gifts, since 2014, her business income varies. In a good month, it can be £2,500, but in other months it can be £400. This has made it difficult for her to plan for retirement.
With her income unstable, Blyth is taking on a second job as an exam invigilator from May, at an hourly rate of £13.50. Although this will boost her income, she’ll be classified as self-employed so won’t get any pension with this role.
This is something she would ideally boost as she has just £976.80 in a private pension and £314 in an old work pension.
Blyth’s mother taught her the importance of putting money in a pension for later life. So, six years into running her own business, Blyth set up a private pension, or self-invested personal pension (Sipp), with Penfold.
She told i: “I currently add £20 a month to my private pension and get a £5 monthly ‘bonus’. In total, at 37 I have £976.80 in my self-invested personal pension.
“I would love to be able to put at least £100 per month into my Sipp, but I simply don’t have the funds to do that right now. Any spare cash I have goes on the mortgage, bills or gets added to a savings account with Plum. My savings account only has about £3,000 in it.
“Emergencies can crop up and I might need access to cash quickly, so I can’t put more in my pension.
“I simply cannot add a decent sum to both my savings account and my pension pot at the same time.”
Aside from her private pension, Blyth has an old work pension from a two-year spell as a charity fundraiser for a hospital. The total saved in this pension pot stands at £314.
Blyth lives with her sister and their five cats in north London. Their weekly food shop has risen from around £40 a week to between £55 to £60 in the past year. Their energy bills have also jumped from £111 to £148 per month and a recent home insurance renewal quote came in £500 higher than a year ago.
Blyth said: “At one stage, I was just worried about having enough money to grow my business. Then I started worrying about having enough money to put food on the table and pay the bills. Now, I’m worried about all those things and about how I can ever retire and be comfortable.
“I have no idea what my future looks like and I can’t afford to plan for it.”
Concerns about the amount she’s able to save for later life are taking a toll on Blyth’s mental health.
She said: “I think my current anxiety levels are higher than ever. You name it, I’m worried about it. I don’t feel like I have any security and am increasingly having to rely on my family financially.
“I’m fortunate to have support from my family, but at 37 it makes me feel totally inadequate. So much is expected of my generation, yet we are facing constant battles, including recession, a pandemic and the cost of living crisis.”
Last month, the Pensions and Lifetime Savings Association said a single person needed £43,100 a year for a “comfortable” retirement. Blyth told i she thinks this is a “pipe dream” for someone in her situation.
Blyth is under no illusion about how long she will have to continue working before being able to claim the state pension.
“Under current plans, I’ll need to be 68 before I can claim my state pension. I think it’s more likely to be 70 by the time I get there. The current state pension is around £10,600 a year, which is clearly not enough to live on. If we are going to see prices in all aspects of life continue rising, then the state pension needs to reflect that. It’s a disgrace.”
She thinks the Government should do more to encourage the selfemployed and small business owners to open and regularly contribute to a pension. “In all the years I’ve run my business, the only advice I have received via the Government is that if I don’t pay enough national insurance, I won’t qualify for a state pension.”
She was also not impressed by Jeremy Hunt’s Budget this month, saying: “The Budget was just hot air. They are filling time until the election and failing to do anything of any use. This Tory Government has single-handedly crippled the country and our mental health is going down the pan with it.”
However, Blyth acknowledges that although it may be small, a tiny pension is better than nothing.
“I have no idea what my future looks like, and the daily anxiety and sadness is hard, but I refuse to give up,” she says.