When is everyone planning on retiring

Drew_TNBD

rlw said:

chrispy108 said:

rlw said:
Our neighbours, both ex teachers, have a pension income of over £60K (paid for by us of course, although they will not admit it).  These days, that's a pension pot of at least £1M, if not more.

Admit what? It was part of their terms and conditions. It's not like the state gave them their pension as charity is it? They worked for it.

I imagine I'll be working until I die though, cheers baby boomers!

They did indeed work for it but did not contribute anything like enough to pay their current pensions.

Their line is that we paid in so we deserve it, thinking that their contributions alone have made it possible when, of course, the scheme is unfunded and paid out of taxation.

They used their lives to teach. As far as I'm concerned, they should be living in mansions with butlers and oral on demand.

thomasross20

The terms and conditions need changed.

chrispy108

So they should retrospectively lose their pension?

It would have been part of the reason they did the job they did for the pay they did.

How would you like it if your employer decided they'd over paid you and took half your savings @thomasross20 ?

dindude

Sambostar said:

41.  Zero pension, no wife, no kids, no house, no mortgage, no assets.  Work hard and I'm fit.  Call me stupid.  I've never understood pensions.  If I die or get ill no one will notice.  Best way to be.  People have so many expectations in life but most never hardly even live it.

Have you ever considered motivational speaking as a career?

thomasross20

Their terms were always untenable and now you're having to pay for it. I know retired service personnel who are living very comfortably and could easily take the cut. I get what you're saying and I'm not seriously seriously advocating it. 
Everybody should pay into a DC plan.

chrispy108

Yeah, I'm paying to tax to support the retirement of teachers. I have no issue at all with that.

octatonic

chrispy108 said:

So they should retrospectively lose their pension?

It would have been part of the reason they did the job they did for the pay they did.

How would you like it if your employer decided they'd over paid you and took half your savings @thomasross20 ?

Exactly.
I'm surprised people have a problem with this.

thomasross20

Me neither, you're twisting it now. 
I'm talking about all those old agreements that are clearly way too generous. Too late now. Do you think we should all pay into DC?

Danny1969

I have no pension, no plans in place, nothing really. I should be bothered by it but I'm not. I rarely plan for the next month let alone 20 years down the road. Something will probably turn up, it normally does

p90fool

Danny1969 said:

I have no pension, no plans in place, nothing really. I should be bothered by it but I'm not. I rarely plan for the next month let alone 20 years down the road. Something will probably turn up, it normally does

Same here. I've had enough curve balls in my life to think I'll just see what happens, I also don't have enough disposable income now to worry about how I'll cope in the future, it's not like I'll have a fabulous lifestyle taken away from me.

p90fool

thomasross20 said:

Everybody should pay into a DC plan.

I don't pay into anything. I earn £6,800 a year plus some gigging cash, my wife not much more. We have a choice of having a little fun occasionally now or having a genuinely miserable time now while trying to save for the future.

We are genuinely happy and have no complaints, but not all of us have a few grand a year spare to play with.

mellowsun

quarky said:

Wait, so I could get a mortgage on my house, (say £120k @ 1% above BOE), so have £100k extra in the bank, and then do what? Put that £40k/year of that into a private pension over three years?

Where do I save the tax though? I am not (at the moment) self-employed?

Yes I'd like @ToneControl to explain this one too! 

I don't get the link with remortgaging and pension contributions

octatonic

p90fool said:

thomasross20 said:

Everybody should pay into a DC plan.

I don't pay into anything. I earn £6,800 a year plus some gigging cash, my wife not much more. We have a choice of having a little fun occasionally now or having a genuinely miserable time now while trying to save for the future.

I don't pay into one either.
I don't trust that they won't be raided by either people running the plans or the government of the time.

mellowsun

octatonic said:

p90fool said:

thomasross20 said:

Everybody should pay into a DC plan.

I don't pay into anything. I earn £6,800 a year plus some gigging cash, my wife not much more. We have a choice of having a little fun occasionally now or having a genuinely miserable time now while trying to save for the future.

I don't pay into one either.
I don't trust that they won't be raided by either people running the plans or the government of the time.

I'm paying into a few but it feels like a mugs game, particularly as the dividends are taxed and the compound effect of management charges eats away at the growth.

sounds like you did the right thing getting into property - it really is the only way to build wealth

rlw

Drew_TNBD said:

rlw said:

chrispy108 said:

rlw said:
Our neighbours, both ex teachers, have a pension income of over £60K (paid for by us of course, although they will not admit it).  These days, that's a pension pot of at least £1M, if not more.

Admit what? It was part of their terms and conditions. It's not like the state gave them their pension as charity is it? They worked for it.

I imagine I'll be working until I die though, cheers baby boomers!

They did indeed work for it but did not contribute anything like enough to pay their current pensions.

Their line is that we paid in so we deserve it, thinking that their contributions alone have made it possible when, of course, the scheme is unfunded and paid out of taxation.

They used their lives to teach. As far as I'm concerned, they should be living in mansions with butlers and oral on demand.

I'm not saying that they shouldn't get the pensions.  Merely that they will not have paid in enough over a forty year period - most of that on a lowly teacher's salary remember but latterly on £100K for her - to have amassed a pension pot worth well over a million pounds and that we - you, me and everyone else - is actually paying their pension out of our tax, rather than it being funded from their contributions and how they were invested.

Fact.  I have to work for five years to pay enough tax to fund one year alone of their pensions.  They cannot see that, long term, that is not going to work.

rlw

chrispy108 said:

It would have been part of the reason they did the job they did for the pay they did.

How would you like it if your employer decided they'd over paid you and took half your savings @thomasross20 ?

She finished on £100K and took early retirement to avoid pension changes.

It happens to everyone with a personal pension - one minute the pot is worth £xxxxxx, the next half of that.

Drew_TNBD

rlw said:

Drew_TNBD said:

rlw said:

chrispy108 said:

rlw said:
Our neighbours, both ex teachers, have a pension income of over £60K (paid for by us of course, although they will not admit it).  These days, that's a pension pot of at least £1M, if not more.

Admit what? It was part of their terms and conditions. It's not like the state gave them their pension as charity is it? They worked for it.

I imagine I'll be working until I die though, cheers baby boomers!

They did indeed work for it but did not contribute anything like enough to pay their current pensions.

Their line is that we paid in so we deserve it, thinking that their contributions alone have made it possible when, of course, the scheme is unfunded and paid out of taxation.

They used their lives to teach. As far as I'm concerned, they should be living in mansions with butlers and oral on demand.

I'm not saying that they shouldn't get the pensions.  Merely that they will not have paid in enough over a forty year period - most of that on a lowly teacher's salary remember but latterly on £100K for her - to have amassed a pension pot worth well over a million pounds and that we - you, me and everyone else - is actually paying their pension out of our tax, rather than it being funded from their contributions and how they were invested.

Fact.  I have to work for five years to pay enough tax to fund one year alone of their pensions.  They cannot see that, long term, that is not going to work.

So bloody what. You make you choices, you take your opportunities, you live your life. End of story. Stop being bitter.

ToneControl

mellowsun said:

quarky said:

Wait, so I could get a mortgage on my house, (say £120k @ 1% above BOE), so have £100k extra in the bank, and then do what? Put that £40k/year of that into a private pension over three years?

Where do I save the tax though? I am not (at the moment) self-employed?

Yes I'd like @ToneControl to explain this one too! 

I don't get the link with remortgaging and pension contributions

if  you are on higher rate tax it works well, if you are  a director, it's easiest, e.g. 
take £100k from house
you would need  nearly double that in your company to give you £100k in your hand,
since there is  employers NIC of 13.8% above £43k, and employees,  etc, and income tax
if you run the company, you'd write £40k company cheques to your pension pot , probably  £160k to £185k in total, not sure of the exact amount

assume you're an employee, and  earn £83k salary (before tax), if you can do salary sacrifice, you can get your employer to do this
if they won't let you do salary sacrifice, at worst you can pay in  0.75 x £40k  = £30k to your pension per year,
that's topped up to £40k , and you can claim back £10k income tax 

This was such a good tax avoidance  (not tax  evasion), that the govt closed it down
the point is that  you are saving  employees NIC, employers NIC, and 40% tax,
but the pension is 25% tax free, and the rest almost certainly  max 20% taxed
so you save the difference

here's a new trick if you're over 55 already:
http://www.telegraph.co.uk/finance/personalfinance/pensions/11012663/Tax-loophole-boost-your-pension-by-88pc-a-year.html

rlw

Drew_TNBD said:

rlw said:

Drew_TNBD said:

rlw said:

chrispy108 said:

rlw said:
Our neighbours, both ex teachers, have a pension income of over £60K (paid for by us of course, although they will not admit it).  These days, that's a pension pot of at least £1M, if not more.

Admit what? It was part of their terms and conditions. It's not like the state gave them their pension as charity is it? They worked for it.

I imagine I'll be working until I die though, cheers baby boomers!

They did indeed work for it but did not contribute anything like enough to pay their current pensions.

Their line is that we paid in so we deserve it, thinking that their contributions alone have made it possible when, of course, the scheme is unfunded and paid out of taxation.

They used their lives to teach. As far as I'm concerned, they should be living in mansions with butlers and oral on demand.

I'm not saying that they shouldn't get the pensions.  Merely that they will not have paid in enough over a forty year period - most of that on a lowly teacher's salary remember but latterly on £100K for her - to have amassed a pension pot worth well over a million pounds and that we - you, me and everyone else - is actually paying their pension out of our tax, rather than it being funded from their contributions and how they were invested.

Fact.  I have to work for five years to pay enough tax to fund one year alone of their pensions.  They cannot see that, long term, that is not going to work.

So bloody what. You make you choices, you take your opportunities, you live your life. End of story. Stop being bitter.

Drew - I'm not being remotely bitter but I am pointing out that it will take an increasing number of people working full time and paying tax to fund an increasing number of retirees on final salary schemes over the next few years.

I'm very fond of my neighbours but they do make me cross sometimes, in much the same way as you

octatonic

mellowsun said:

octatonic said:

p90fool said:

thomasross20 said:

Everybody should pay into a DC plan.

I don't pay into anything. I earn £6,800 a year plus some gigging cash, my wife not much more. We have a choice of having a little fun occasionally now or having a genuinely miserable time now while trying to save for the future.

I don't pay into one either.
I don't trust that they won't be raided by either people running the plans or the government of the time.

I'm paying into a few but it feels like a mugs game, particularly as the dividends are taxed and the compound effect of management charges eats away at the growth.

sounds like you did the right thing getting into property - it really is the only way to build wealth

I can't claim to have any real skill in doing this- it is just how things worked out but yes, I think it will be the right thing to do.
Especially in London- anyone see this today? 
http://www.bbc.co.uk/news/business-37864258

Rents across the UK are set to rise considerably faster than house prices over the next five years, according to property agents Savills.
It forecast that rents will go up by 19% between now and 2021, while house prices will only rise by 13%.
The gap will be even more pronounced in London, where it said rents will rise by 24.5%, and house prices by 10.9%.