In other news - pension changes?

thomasross20

Just read this:

http://www.bbc.co.uk/news/business-35360978

Crap if you're on a higher rate, great if on a lower rate. Maybe for the best overall. 

Is anybody considering throwing in a small fortune to get the most out of this before any changes?

mellowsun

I lost 20 grand this week from my pension pot thanks to the stock market crashing.

Defined contribution pensions are pretty high risk - after fees and stock market ups and downs, you'll be lucky to get back what you paid in.

Jalapeno

mellowsun said:

I lost 20 grand this week from my pension pot thanks to the stock market crashing.

Defined contribution pensions are pretty high risk - after fees and stock market ups and downs, you'll be lucky to get back what you paid in.

Yep. Thanks Gordon Brown ! :x

quarky

I have a final salary pension which will be the bulk of my retirement income (and why I am still in the same job after 13+ years, when my previous longest stay was 2 years), so am probably not that affected.

My other pension savings, I just do via a Shares ISA.

Hopefully those two will keep me covered, even if another Government does a Gordon Brown type cash grab..

Danny1969

Lol Thomas you about 30 years old now aren't you, bit soon to be worrying about pensions ain't it ?

Snap

mellowsun said:

I lost 20 grand this week from my pension pot thanks to the stock market crashing.

Defined contribution pensions are pretty high risk - after fees and stock market ups and downs, you'll be lucky to get back what you paid in.

its all relative. Stock market losses only matter if you need to take the money out. Long term stocks perform well.

A stock market crash is a perfect time to buy. If you are regularly paying into a scheme, don't forget that you are buying stock when its low, as well as when its high.

You've only lost 20k if you bought yesterday and need to sell today. Otherwise its not worht fretting about. YOu could drive yourself nuts.

IF you are part of a managed fund, you have to trust that the managers know what they are doing. They should do!

Theres some further dropping to be done yet IMO. MIght be a good time to buy some gold, though I haven't looked at the price.

My general rule with shares is buy into solid companies with good balance sheets. They will be good over the longer term. Also, buy funds, leave the stocks to experts.

BigMonka

thomasross20 said:

Just read this:

http://www.bbc.co.uk/news/business-35360978

Crap if you're on a higher rate, great if on a lower rate. Maybe for the best overall. 

Is anybody considering throwing in a small fortune to get the most out of this before any changes?

It's all a bit of hearsay at the moment, so you'd be brave to start chucking a load of money in just in case something happens.

I agree with the idea of a flat rate for tax relief though, it's a much fairer system. Like the cycle to work scheme, why should a higher rate payer get more tax relief on a bike?! It's crazy, the poorer are subsidising the richer getting richer!

Sporky

Danny1969 said:

Lol Thomas you about 30 years old now aren't you, bit soon to be worrying about pensions ain't it ?

Not if he wants to take advantage of compound interest.

Sporky

BigMonka said:

why should a higher rate payer get more tax relief on a bike?! It's crazy, the poorer are subsidising the richer getting richer!

Because the higher rate payer is paying more tax in the first place. And tax relief on a bike is hardly the rich getting richer.

CabbageCat

Danny1969 said:

... bit soon to be worrying about pensions ain't it ?

A pension is something you pay into when you are young and spend when you are old. If you thought it was the other way round I suspect you might be in for a nasty shock in the 2030s (...assumptions about username).

Rocker

Never too young to start your pension plan.

Phil_aka_Pip

pension = paying a bunch of crooks to take care of your money with no guarantee you'll get back what you put in let alone growth.

Sporky

The trick there is to give your money to someone trustworthy and reasonably honest, rather than to a bunch of crooks.

Phil_aka_Pip

Sporky said:

The trick there is to give your money to someone trustworthy and reasonably honest, rather than to a bunch of crooks.

Well, yes, it would be nice if you could identify them. That strikes me as being the tricky bit

Sporky

Fair point. Mine have been OK so far, but I s'pose they all seem OK until they go rogue.

viz

I think it's a good proposal, to reduce tax relief for high earners, if it helps prop up low income pensions and encourages saving.

Jalapeno

DC pensions are nowhere near as good as envisaged, and fleecing the middle classes (these people aren't in anyway "rich") is what all Governments are about seemingly.

thomasross20

Yeah mine is DC and I have to put a ridiculous amount in to get something small back in retirement. Add to that the cost of a house and, if you're so inclined, a family - jesus... 

thomasross20

Oh yeah, compound interest!! 

I get what folks say about not trusting pension providers but I've got to do something and my company chuck in close to 10%. I also put in 11%. More goes into my pension than my partner earns and despite being young, it still looks to be pretty lame in retirement. I should probably put 20% in myself!

chillidoggy

Here's the thing:-

When you're young, pensions are not sexy. They're something old farts are into.

When you near retirement age, pensions suddenly become sexier than a threesome with Jennifer Lawrence, Nigella Lawson and the blonde tart off Strictly whose name escapes me (NB - peanut butter and honey may also be involved in said threesome).

All of which means that pensions increase in sexiness at a geometric rate, as you approach the point where you think "Oh, shit, I'm gonna be visiting the Sally Annie soup kitchens in my dotage, and be forced to drink cheap-shit lager instead of half-decent gin and tonic in the south of France, or the Caribbean."

The upshot of this wonderfully insightful summary is that you need to sort out your pension arrangements as soon as possible, rather than wait until it's too late.

Phil_aka_Pip

@chillydoggy unless you're convinced you're not healthy enough to achieve a long retirement