What's the current situations and crisis of state and occupational pension??

yostv

Just need a little info on this, any comments are apreciated :j . Many thanks

dunstonh

None really.

State pension age has been pushed back which should help cover the rising costs in the future (at least in the short term).

Occupational pensions continue their ongoing move to money purchase and from 2012 employer contributions will be compulsary. The latter being a positive move.

Current market conditions arent good for those retiring in the short term (assuming they didnt risk reduce as they got closer - many do). However, those conditions are good for long term investors who are now buying investments cheaper.

Like most occassions when something like this happens, short term it looks bad but long term it can be very good.

john.xs

out of interest what would you class as short term and long term?

dunstonh

out of interest what would you class as short term and long term?

short term is less than 5 years. Medium term is 5-10. Long term is 10+ (some refer to medium term as 5-15 and long as 15+ but short term is consistently less than 5).

jamesd

While it is just business as usual on the normal 5-10 year ups and downs pattern, don't be surprised to see lots of scare stories in the press over the next two years about shortfalls in occupational pensions. It's an inevitable result of a drop in share prices. This is one of the more severe downturns, but the cycle is routine.

You'll also see press about companies dealing with people living longer and having to pay more into their work pension schemes to cover it, or adjust them in some other way. The BT scheme that's in the news at the moment is one example.

If you're making more than about 30k and have a work final salary or other defined benefit pension you should read about the Pension Protection Fund compensation limits, which may not be enough to fully protect 90% of the pension.