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  • FIRST POST
    • westport
    • By westport 29th Jan 18, 2:46 PM
    • 7Posts
    • 0Thanks
    westport
    Beware State Pension shock when partner dies
    • #1
    • 29th Jan 18, 2:46 PM
    Beware State Pension shock when partner dies 29th Jan 18 at 2:46 PM
    I phoned the State Pension line to find out what happens if your partner dies under the new State Pension scheme, if you have both qualified for the full amount. I could not believe what I was hearing when I was told that you will get nothing from your partners pension, unless you have made any additional contributions before April 2016, which I am sure the majority of us will not have done, as it would have just been taken directly from your employer. So when a partner passes away you will still have the same household bills, but will only get half the income. This needs to be publicised or a lot of people are in for a big shock.
Page 6
    • DairyQueen
    • By DairyQueen 6th Feb 18, 9:42 PM
    • 170 Posts
    • 286 Thanks
    DairyQueen
    Personal finance needs to be taught in schools to fix this.
    Originally posted by ams25
    Absolutely agree. Reading, writing, driving - all essential skills. Knowing the basics about pensions and investing has never been more important. The government has unleashed a genie that can be helpful or harmful. All depends on each individual's ability to manage it but how can they do so without the necessary information and skills? (rhetorical)
    • LHW99
    • By LHW99 6th Feb 18, 10:38 PM
    • 1,145 Posts
    • 1,012 Thanks
    LHW99
    Knowing the basics about pensions and investing has never been more important.
    There is definately room for much more financial education. However, the issue with schools teaching the basics of pensions is that things no longer stay the same for 40 or 50 years. Unless people are interested and prepared to continue learning of their own bat, the knowledge will soon become outdated.
    I can think of the things that have changed over my working lifetime of almost 50 years, including:
    Pensions contributions having to be refunded if you left a job within five, then 2 years of starting.
    Not being able to have a personal pension if you had a work pension
    "Unit linked" pension types being regarded as far more risky than With Profits (probably in terms of lack of commission for the salesman)
    Money in Protected Rights pensions not being treated like personal pension / SIPP money
    And then the changes in the State Pension - married women's stamp, graduated pension, S2P, New State Pension, changes in SRA -

    I do remember there was the equivalent of "personal finance" when i was at school - it covered compound interest, savings accounts and cheques, but nothing that was really helpful beyond about 5 years after leaving school.
    Nowadays you'd probably need to start with "avoiding pension scams" and "choosing secure passwords for your bank accounts".
    • ams25
    • By ams25 6th Feb 18, 11:29 PM
    • 135 Posts
    • 150 Thanks
    ams25
    Two people..same job, same salary progression etc

    One retires at 55 with a high 6 figure pension pot
    The other has to work beyond SPA and retires with not much beyond the state pension.

    The difference....

    One understood....saved and invested early....not so much to start but increased savings over time and time in the market did its job
    The other did what most do. Nothing - until it was too late to make much difference.

    Still a choice for people to make..but I think one way too few people understand is a choice for them (with consequences). Really believe those leaving school need to get this message. Has the power to transform lives imho.
    • GibbsRule No3
    • By GibbsRule No3 7th Feb 18, 6:18 AM
    • 645 Posts
    • 376 Thanks
    GibbsRule No3
    There is definately room for much more financial education. However, the issue with schools teaching the basics of pensions is that things no longer stay the same for 40 or 50 years. Unless people are interested and prepared to continue learning of their own bat, the knowledge will soon become outdated.
    Originally posted by LHW99
    I think because things no longer remain the same for long, is why it is now more important that it be taught in school. From a quick look at things that would have affected me in 1971 when I started work, the SP age range was introduced in 1948, so had been, for me a female, already in place at 60 for more than 23 years when I started work, it then went almost as long again before it changed and then quickly changed again and will no doubt now change in all sorts of ways, some already introduced, as explained in an earlier post. It went almost unchanged for the length of a working life. If school children are taught how quickly things change they may be able to see how important pensions are to them and keep an eye on things when they get work.
    Paddle No 21
    • marlot
    • By marlot 7th Feb 18, 7:12 AM
    • 3,271 Posts
    • 2,381 Thanks
    marlot
    ...
    One retires at 55 with a high 6 figure pension pot
    The other has to work beyond SPA and retires with not much beyond the state pension.
    ....
    Originally posted by ams25
    I saved more than 50% of my gross pay into my pension for a number of years. Peaking at 68%.

    We had to make sacrifices to do so. Few holidays, cycling instead of cars. Lots of working away from home, and long hours etc. But it had to be done, as I have a degenerative illness and didn't know if I could work beyond 50. I feel incredibly fortunate that a consultant found a way of halting the deterioration in my condition.

    I now have lots of people telling me that I am 'lucky' to be retiring this year (54). I do indeed feel fortunate - mostly for my health. The financial freedom is helpful, and I'm glad I made the choices I did.
    Last edited by marlot; 07-02-2018 at 7:19 AM.
    • marlot
    • By marlot 7th Feb 18, 7:18 AM
    • 3,271 Posts
    • 2,381 Thanks
    marlot
    .... For the record, my parents went without proper food for weeks when my dad switched from weekly to monthly pay. They did so in order to make sure that decent food/heat/housing were maintained for me and my sibling.

    Can you imagine that happening now?
    Originally posted by DairyQueen
    Sadly, I do see pockets of this at our local foodbank. Universal Credit is paid monthly, and people struggle to adapt.
    • crv1963
    • By crv1963 7th Feb 18, 3:21 PM
    • 231 Posts
    • 563 Thanks
    crv1963
    Two people..same job, same salary progression etc

    One retires at 55 with a high 6 figure pension pot
    The other has to work beyond SPA and retires with not much beyond the state pension.

    The difference....

    One understood....saved and invested early....not so much to start but increased savings over time and time in the market did its job
    The other did what most do. Nothing - until it was too late to make much difference.
    Originally posted by ams25

    Still a choice for people to make..but I think one way too few people understand is a choice for them (with consequences). Really believe those leaving school need to get this message. Has the power to transform lives imho.
    Originally posted by ams25

    This sounds so familiar especially where I work, even though the specifics might be hard to understand the concept is simple- save regularly a reasonable percentage in a wrapper and you'll be financially better off when you are older/ pensionable.


    I work with staff (NHS) who have opted out of the pension scheme, and others who don't grasp that even with the changes it's a great pension.


    All I seem to get told is well you won't live long enough to enjoy it! One heart attack later, I'm back fulltime and with a definite plan, a healthier ticker or so I'm told and a zest for making sure Mrs CRV and I can retire at a standard of living not dissimilar to the one we have now in a few years time- the backbone of the retirement will be my DB pension and then agency work to build up Mrs CRV pot.


    We are the classic case you describe, me the former and she the latter- luckily she does have bit locked away so a few years adding to our DC pots should tide us over to SP (and hopefully beyond) where DB, SPs and what's left of DC pots should have us not worrying about needing too much unless of course we do buy the Ferrari!


    With young people it is a similar case, I have two sons, oldest reasonable income, minimum into pension saving (I'll worry bout that when I'm older), youngest age 20- I'm saving 11% of my salary into the company pension is that enough or do you think I should start a SIPP Dad?


    Same education, upbringing and advice over the years- different outlook and priorities.
    CRV1963- Light bulb moment Sept 15- Planning the great escape- aka retirement!
    • DairyQueen
    • By DairyQueen 7th Feb 18, 4:59 PM
    • 170 Posts
    • 286 Thanks
    DairyQueen
    I work with staff (NHS) who have opted out of the pension scheme, and others who don't grasp that even with the changes it's a great pension.
    Originally posted by crv1963
    Good Lord above! Opting out of a government-backed, DB scheme in this day-and-age borders on insanity! Talk about looking a gift-horse in the mouth.

    Who are these geniuses? (Just kidding). Please pass on the sincere thanks of every taxpayer. For every (very approximately) £3k of pension income they forego they are currently saving the public purse approx. £100k.

    I'm saving 11% of my salary into the company pension is that enough or do you think I should start a SIPP Dad?
    Same education, upbringing and advice over the years- different outlook and priorities.
    Originally posted by crv1963
    Not just young people either. My brother and I fit the same profile and we are late 50s/early 60s. Thankfully, I'm the equivalent of your youngest.

    My bro has worked hard all of his life but has precious little to show for it because he is a terrible money-manager. Refuses to research and refuses to engage with anyone on money issues.

    He has needed bailing-out throughout his life (mostly by our parents). He has several pension plans but has neglected things to such an extent that the old DCs have been made worthless by neglect, high charges and poor fund choices, and he is now max-ing out the tax-free cash on his small DB pensions as they become available (and spending it). As he is still working the pension in payment is taxed but will he divert that money back into a pension? Not on your life. That is spent too.

    He has been kicking money problems down the road all of his life. He is now 5 years from SPA and faces an impoverished old age but he is still kicking.

    I can't help but wonder whether things would have been different for him had he been taught just the basics about finances and pensions at school. Our parents are fiscally responsible and did their best to educate and guide both of us in that direction. I followed suit, he didn't. He won't accept advice from family members (no such resistance to accepting our money) but I think that he may (just 'may') have listened in school.
    • Clifford_Pope
    • By Clifford_Pope 7th Feb 18, 5:00 PM
    • 3,489 Posts
    • 3,582 Thanks
    Clifford_Pope
    I think because things no longer remain the same for long, is why it is now more important that it be taught in school. .
    Originally posted by GibbsRule No3
    I learned Latin at school. It was considered vital for university entrance and securing a good job.
    • crv1963
    • By crv1963 7th Feb 18, 5:15 PM
    • 231 Posts
    • 563 Thanks
    crv1963
    DQ- I've given up talking about pensions with some at work, some are so fatalistic about enjoying it and are "spend now" that they'll just have to learn later! They think saving even more is madness!


    Hopefully my oldest will realise before too long he needs to save for his old age, there won't be any bailing out from me but that said he can save for things he wants very well, even if it means going without for now- so I do have some hope.
    CRV1963- Light bulb moment Sept 15- Planning the great escape- aka retirement!
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