Opting out of pension

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  • k6chris
    k6chris Posts: 738 Forumite
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    OldBeanz wrote: »
    .......
    Who
    No, The Who.... :)
    "For every complicated problem, there is always a simple, wrong answer"
  • OldMusicGuy
    OldMusicGuy Posts: 1,761 Forumite
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    OldBeanz wrote: »
    .......
    Who
    I was going to add that younger readers may need to make use of Google at this point.....
  • Malthusian
    Malthusian Posts: 10,961 Forumite
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    kmb500 wrote: »
    thanks for your comment. I suppose my outlook is that the idea of being an unhappy pensioner doesn't bother me; I care more about making the most of my life now even if that is detrimental to me when I'm old. Maybe that's silly.

    Not so much silly as inaccurate, as if you cared about making the most of your life now you wouldn't smoke.

    Smoking costs an absolute fortune and makes you slower, weaker, smellier and all round less sexually attractive. It's nothing to me if people smoke but they can't claim to be living life to the full.
  • haras_nosirrah
    haras_nosirrah Posts: 2,208 Forumite
    edited 29 September 2017 at 4:29PM
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    if I pay you £84 a month will you give me your pension? To get your pension equivalent in the private sector you would have to pay in £600 a month. You have one of the only decent pensions left and you want to throw it all way to go out drinking.

    53 people on this thread have told you not to do it. Some are financial advisors, others are people with regrets as they did what you are about to do. You want us to convince you - sorry that is not our job. You are an adult and if you want to commit financial suicide for some extra beer money then go right ahead - the tax payers will be happy as your pension costs us a fortune. I would literally kill for your pension. Search the internet for others who have done what you are about to do and wish they could turn back time.

    there is a famous saying - don't look a gift horse in the mouth meaning don't look for fault in something you have been given. You are about to not only look the gift horse in the mouth but give it a massive kicking. If you opt out of that pension now there will always be an excuse to not opt back in. You need more money for other things. It will be your biggest life regret if you leave.
    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
  • ss53
    ss53 Posts: 90 Forumite
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    haras_nosirrah wrote: »
    I would literally kill for your pension.

    I hope you mean figuratively rather than literally.
  • haras_nosirrah
    haras_nosirrah Posts: 2,208 Forumite
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    ss53 wrote: »
    I hope you mean figuratively rather than literally.

    if she doesn't want it I will happily take it. Kill maybe too extreme but as someone paying £750 a month into her pension in the vain hope of getting something like a living pension out the other end I am incredibly envious of the opportunity she has and am banging my head against a brick wall they she wants to chuck it away.
    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
  • Triumph13
    Triumph13 Posts: 1,740 Forumite
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    I'm going to stick my head above the parapet on this one as some of the knee jerk analysis on this one may be slightly flawed. Yes it's screamingly obvious that the 'right' answer here is to stop smoking instead of stopping the pension, but if the OP did end up stuck in this same job until state pension age, what would the numbers actually look like? If we assume SPA will be 70 by the time he gets there, then he has 49 years to go in a scheme with a 1/49th accrual rate. He would therefore have 'scrimped and saved' until he was 70 in order to suddenly have a 55% increase in his take home pay on his 70th birthday when state pension starts and both NI and pension contributions stop.
    If that genuinely was the way he was planning to live his life, then, strangely enough, it probably would make sense for him to move to the 50:50 scheme for most of his career.
    Of course, the great advantage of staying in the full scheme is that it gives him the flexibility to retire much earlier than 70, but if he is there for the long haul then 50/50 for a while might not be that dumb, and if he is going to do so then it makes more sense to do it early on rather than later as with DB schemes it is the later years that represent the best value for money - the opposite of with DC schemes.
    So whilst I fundamentally agree with everyone else that it would be a really dumb idea to opt out or go 50/50, it's not quite as dumb as it has been painted.
  • POPPYOSCAR
    POPPYOSCAR Posts: 14,897 Forumite
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    haras_nosirrah wrote: »
    if I pay you £84 a month will you give me your pension? To get your pension equivalent in the private sector you would have to pay in £600 a month. You have one of the only decent pensions left and you want to throw it all way to go out drinking.

    53 people on this thread have told you not to do it. Some are financial advisors, others are people with regrets as they did what you are about to do. You want us to convince you - sorry that is not our job. You are an adult and if you want to commit financial suicide for some extra beer money then go right ahead - the tax payers will be happy as your pension costs us a fortune. I would literally kill for your pension. Search the internet for others who have done what you are about to do and wish they could turn back time.

    there is a famous saying - don't look a gift horse in the mouth meaning don't look for fault in something you have been given. You are about to not only look the gift horse in the mouth but give it a massive kicking. If you opt out of that pension now there will always be an excuse to not opt back in. You need more money for other things. It will be your biggest life regret if you leave.



    On second thought- yes opt out.
  • haras_nosirrah
    haras_nosirrah Posts: 2,208 Forumite
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    It is costing the op £84 a month to get £400 with this money then increasing in value over time. They are not saying they are unable to afford the rent and about to get evicted or in fact are really struggling. They were happy paying the pension until discovering that they may be able to opt out and now would rather have more beer money as retirement is a really really long time away. This is exactly why we need financial education in schools. To opt out of this pension would be madness - there is no other way to describe it
    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
  • JoeCrystal
    JoeCrystal Posts: 3,026 Forumite
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    edited 29 September 2017 at 5:05PM
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    haras_nosirrah wrote: »
    if she doesn't want it I will happily take it. Kill maybe too extreme but as someone paying £750 a month into her pension in the vain hope of getting something like a living pension out the other end I am incredibly envious of the opportunity she has and am banging my head against a brick wall they she wants to chuck it away.

    Me too. I pay in 20% to 25% of my salary (Not high as your amount in pounds) and still, the projection look really miserable. The projection tell me that I will get about a third of my salary if my pension pot grew at mid investment rate by SPA in 37 years. :eek:

    I am giving a serious thought to finding a job with DB pension scheme so I can transfer a part of my pension pot in exchange of an index-linked guaranteed income by SPA a decade or two down the line (if they still are around).
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