You should feel sorry for the youngsters of today. The pension you have is likely so unaffordable that they're paying for yours just as much as you did.
Your Pension.
- Thread starter Camalot
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You should feel sorry for the youngsters of today. The pension you have is likely so unaffordable that they're paying for yours just as much as you did.
That is true in a number of ways - not just because hardly any good defined benefit schemes are open to new entrants any more.
I've heard a number of pensioners boldly state that they deserve their pension as they paid for it (most likely at a rate of around 5% or less of their salary) and making it very clear they don't care about anyone coming along after them receiving a worse deal. Private pensions paid from large company schemes tend to be paid from the overall pension fund rather than from purchased annuities. The increasing liabilities of these pensions is paid for by increased contributions to the pension scheme long after current pensioners stopped paying in. For those living to a ripe old age chances are their own contributions would only cover a small part of the cost of the benefits they will receive.
And when it comes to the state scheme it looks as though they are going to keep moving the goalposts, so those now working will not only have to keep paying in much longer but when/if you finally get to retire you won't actually get a bigger pension for paying in for (say) 50 years rather than 30.
</rant>
An investment offered on this basis is illegal, yet for pensions it is seemingly fine. A huge generalisation but is effectively true, as the assumptions on which pensions schemes like this were started 50 years ago started to unravel a long while ago. When it comes to the board, or even pension trustees, it is easier to put your head in the sand when it comes to the pension fund as you'll certainly be retired when the issue comes up, or dead.
Pensions are horribly misunderstood. Unfortunately, they're most mis-understood by those that have the best ones that, in many cases, are disproportionately supported by everyone else.
Yes, isn't it amazing that despite austerity budgets and efforts to clean up MP expenses etc. there are no moves (of which I am aware) to get them onto a nice, simple defined contribution pension scheme. Instead it's a generous defined benefit arrangement with the tax payer picking up the "open ended" tab. But we are all in it together
Yes, isn't it amazing that despite austerity budgets and efforts to clean up MP expenses etc. there are no moves (of which I am aware) to get them onto a nice, simple defined contribution pension scheme. Instead it's a generous defined benefit arrangement with the tax payer picking up the "open ended" tab. But we are all in it together
Indeed. Binning the MP's pension would be a fantastic start, one that could then see the end of all the overly generous public sector final salary schemes.
But let's not get carried away too much. We do not want a race to the bottom of costs. If I had a final salary scheme available at work I'd almost certainly join it.
What we're really looking for are two different things, both incredibly difficult to achieve:
a) an understanding of how much it will cost someone to save for the retirement lifestyle they want
b) a level playing field (or at least one driven by market forces) for all savers.
What the nation cannot afford is to perpetuate the status quo, with minor tweaking around the edges. The principle, cost and subsequent upheaval of the poll tax should be small beer compared to the current pension situation. It hasn't manifested yet because the true cost is being kicked down the road for yet another government to sort out.
As the generation after the baby boomers start to retire it will become completely unaffordable. Action today can prevent it.
Yes, isn't it amazing that despite austerity budgets and efforts to clean up MP expenses etc. there are no moves (of which I am aware) to get them onto a nice, simple defined contribution pension scheme. Instead it's a generous defined benefit arrangement with the tax payer picking up the "open ended" tab. But we are all in it together
Indeed. Binning the MP's pension would be a fantastic start, one that could then see the end of all the overly generous public sector final salary schemes.
But let's not get carried away too much. We do not want a race to the bottom of costs. If I had a final salary scheme available at work I'd almost certainly join it.
What we're really looking for are two different things, both incredibly difficult to achieve:
a) an understanding of how much it will cost someone to save for the retirement lifestyle they want
b) a level playing field (or at least one driven by market forces) for all savers.
What the nation cannot afford is to perpetuate the status quo, with minor tweaking around the edges. The principle, cost and subsequent upheaval of the poll tax should be small beer compared to the current pension situation. It hasn't manifested yet because the true cost is being kicked down the road for yet another government to sort out.
As the generation after the baby boomers start to retire it will become completely unaffordable. Action today can prevent it.
It's scandalous. People of today are essentially being stolen from to fund the retirement of your generation. Sorry? You should feel ashamed.
I do not feel ashamed at all.
I had the choice, to join the scheme or not, I also paid AVC's with Equitable life and over time even with the supposed government compensation scheme I lost nearly £12,000.
As I said, I feel sorry for the youngsters who will never be able to achieve a comfortable retirement thanks to the government assault on the pension funds.
I did the best I could to assure myself and my wife a comfortable retirement, so why should I feel ashamed, I am sure if you were in my position, you would have done the same.
It was unfair of me to single you out, and for that I apologise.
But the baby booming generation as a whole should be pretty ashamed of what they've done to this country. An unrealistic property market, a pension fund so butchered it's bordering on criminal, for starters. And if I hear another pensioner claiming that the government never does anything for them, or kids have it easy these days I'll probably blow my top. The sheer self-indulgent, misguided, ill informed and selfish attitudes my wife has to listen too, visiting mostly pensioners, on a daily basis makes me so angry.
But the baby booming generation as a whole should be pretty ashamed of what they've done to this country. An unrealistic property market, a pension fund so butchered it's bordering on criminal, for starters. And if I hear another pensioner claiming that the government never does anything for them, or kids have it easy these days I'll probably blow my top. The sheer self-indulgent, misguided, ill informed and selfish attitudes my wife has to listen too, visiting mostly pensioners, on a daily basis makes me so angry.
Soldato
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Started paying in £500 a month about 18 months ago, doubled that to a grand about 6 months ago, im 41 now though so really need to start ramping up, hopefully have another good year and be able to double that up for a few years at least.
Are you going to have to start paying your employees a pension Mark, or are you a sole worker (self employed?)?
Soldato
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Yeah, although its scaled so not for another few years yet by law.
I started a pension at 30 to retire at 55. Im self employed so thought I better start something. Alongside that I put money every month into a share portfolio which is heavily dividend focused to also produce an income at retirement.
I've now got 3 people working for me who shouldn't be because the pensions they paid into all their lives failed to pay out.
Also my sister in law who is a midwife has paid into a NHS pension for 25 years. In 12 years time she was due to retire at the age of 55 and have a nice monthly sum to live on. She's just been told she'll have to work 10 years longer and then receive reduced monthly payments.
Someone, somewhere is making a lot of money out of our pension contributions.
Also my sister in law who is a midwife has paid into a NHS pension for 25 years. In 12 years time she was due to retire at the age of 55 and have a nice monthly sum to live on. She's just been told she'll have to work 10 years longer and then receive reduced monthly payments.
Someone, somewhere is making a lot of money out of our pension contributions.
It is unfair to say that all final salary type pensions are exploitative of future generations. In my own case it is from a private corporation who have had a fully funded scheme for all of the time I worked for them.
The return after 27 years of work is circa 14k pa. This will obviously be taxable and in my opinion does not adverseely affect anyone. In fact because of my self sufficiency and foresight in contributing to my own future, the state will be better off as I will obtain little or no support from it in terms of top ups or other benefits.
Current employees with the same company have similar contributions taken from their salaries to that taken from mine.
I have 18 years in a final salary scheme that is now parked as I was made redundant a couple of years ago. It's a large private company and I can take it from 50 if I want, which is only a few years away.
I am now working for another large multinational company that has a generous defined benefit scheme running, I hope to be able to retire by 60 as I will have no mortgage.
I am now working for another large multinational company that has a generous defined benefit scheme running, I hope to be able to retire by 60 as I will have no mortgage.
Whatever you do with that pension do not take it at 50, for every year before your retirement age you loose a certain percentage of your pension pot, I am not up to speed any more on the pension side, but from what I remember you could loose up to 60% of you pension pot by taking it at 50.
I would certainly get some figures if you are thinking of taking that pension at 50, and get quotes for 55, 60 and your retirement age and see the difference.
I to worked for a private corporation, after 27 years mine was slightly higher than yours due to saving in AVC's.
I used to pay 6%, but this has now gone up to 7% for there employees now.
I have to agree with some of the posters about public funded final salary schemes being a burden on the taxpayer, but that was what was on offer when they were employed so you cannot blame them.
If successive governments had not kept raiding the pensions to the tune of £5 billion a year, pension would be a lot healthier.