Half of UK have no pension

Pobby

I wonder why that the UK pays out some of the worse state pensions? I believe that the average European pension paid by the state equates to something like 50% of average wages of that country. I know that Spain is far more generous than than the UK in that way.

Following on from that, young folk are expected to pay back student debt, buy a home possibly and pay a a large chunk into a pension fund. Good ain`t it.

seven-day-weekend

In other places (such as Spain), the idea of a personal or company pension isn't anywhere near as widespread as it is in the UK.

Also they pay a LOT more NI (250€ a month for self-employed, even if they have made no money that month!).

I also think some State Pensions in other countries (Germany may be one) are means-tested which ours is not.

So I guess our system works out better if you have made your own provision as well as relying on the State Pension.

Toto

dunstonh wrote: »

thats where the pension credit could come into play. Maybe link it to average earnings over your working life. HMRC have all that data. That way low earners benefit. Not middle to high earners who were too lazy.


What companies have flushed it down the plughole?

Times like this when the investments have gone down (ignoring the 20% rise in recent months) are great news for long term investors paying in still. You are buying your investments back at 2005/2006 prices.

This is all good but what about the large chunk of people who gave up working to care for someone, women who spend time rasing kids etc.

I'm 39 and I don't have a pension, to be honest the past 20 years have been filled up with trying to survive while raising kids (with no financial help at all from their father who went abroad so the CSA wouldn't catch him). We had a business which we closed because two of our clients went bankrupt owing us over £150k, we had enough to pay off our invoices so spared ourselves bankruptcy.

I do worry about what will happen when we retire, if we ever do. So, we are saving as much as we can in ISAs. But honestly for most people these days just keeping a roof over your heads and raising kids leaves nothing to plan for retirement.

dunstonh

This is all good but what about the large chunk of people who gave up working to care for someone, women who spend time rasing kids etc.

Thats where the effective means test would come in to play. You would have a low income over your working life. Therefore you couldnt make provision that someone on say £40,000 a year could make. You would fall within the safety net.

I do worry about what will happen when we retire, if we ever do. So, we are saving as much as we can in ISAs. But honestly for most people these days just keeping a roof over your heads and raising kids leaves nothing to plan for retirement.

Thats an excuse that gets churned out often but its really a case of not having the correct priorities. Someone in their early 20s can pay an index linked £50pm and get around £10k a year in real terms in retirement. Thats less than a typical sky subscription, less than one restaurant trip. Less than a trip to the Cinema.

The encouragement to live beyond your means has damaged the economy and damaged the opinions of many people. Once we had the pension system that was the envy of Europe. The borrow and spend culture has done the most damage.

BTW, thats not aimed at you toto but a generalisation.

Toto

You are right I know Dun, to be honest I wish more than anything that when I was in my early 20s I was educated to save for retirement. The trouble is, when you are young you think old is 30 and something that will never happen to you.

All of my family were working class, they all worked for British Aerospace and it was just accepted that you got a job, stayed there for life and retired on a state pension plus anything you had saved. I don't think it even occured to me to have a private pension plan until I was very late 20s to be honest. Even then I think I just thought that private pensions were for posh people.

You are spot on when you say that our priorities are wrong. I do think that the lack of financial education is to blame, along with buy now pay later becoming the norm.

I'm sure there are many like me though who will suddenly see 40 looming and start to panic, at least I still have a good 25 years (I hope) to try save as much as I can. I am pretty money aware so do cut out lots of the junk spending, but I'm sure lots of people don't.

Carmen_Queasy

I can barely afford basics let alone to pay money into a pension or savings or anything like that! I think the biggest problem this country has is minimum wage is nowhere near high enough, so most people simply can't afford these things.

roy62

Buying the biggest house in the best part of town you can afford would be my advice to anyone. Nothing beats property in the long run.

davidjohn_2

So, you cannot afford to put money into a pension,does anyone know the minimum amount one can put in.Do you smoke ,drink on a regular basis or gamble,if so stop one ,there thats your pension sorted.

donstermonster

dunstonh wrote: »

The fact that nothing else provides an income that can beat the pension is probably the main reason.

A VERY bold statement , are you sure ?

Try telling that to the hundreds of thousands of people who have no or reduced pension pots

Now you pay NO tax on money going into a pension but do pay tax on it coming out , you would hope that the money coming out is far more than going in so tax relief should be the other way round !!!!

Also i get to 57 and having saved for 40 years into a pension get cancer or some other terminal illness so would like to take my several hundered thousand pound pot and enjoy my last few months , can i ? NO i cannot

Sounds like the WORST "investment" ever

I strongly disagree with your sweeping statment , but i am happy to be convinced other wise

PS - I am not arguing or being offensive i just feel your statement is flawed and not researched

MikeJones_2

Hi donstermonster,

donstermonster wrote: »

...Also i get to 57 and having saved for 40 years into a pension get cancer or some other terminal illness so would like to take my several hundered thousand pound pot and enjoy my last few months , can i ? NO i cannot...

If your life expectancy is less than 12 months you can take your pension fund as a lump sum. See:

- RPSM09104610 - Technical Pages: Member benefits: Lump sums: Serious ill health lump sum: Conditions for payment (HMRC)

Baby_boomer,

baby_boomer wrote: »

Typical of the BBC's "we don't live in the real world" approach is the following:

"Taking [a cash lump sum on retirement] does not affect the pension payable to your qualifying spouse, qualifying civil partner or dependants. It will still be calculated on your full pension, as though you had not chosen to exchange part of it for cash."

I understand why you've pointed this aspect out, but in my experience it is not that uncommon through the defined benefit scheme population in the UK. What is surprising is the amount of scheme members who don't know how valuable that particular benefit is - mostly because they don't even think/know to consider it.

Mike

I work in the field of Pension Education and Pension Guidance in the UK. I am a member of the Specialist Pensions Forum as well as being a Voluntary Adviser for The Pensions Advisory Service. I work with scheme members, employers, trustees, scheme administrators and advisers on most things to do with employer sponsored pension schemes. The views expressed by me in this thread are my personal opinions. You should seek professional advice from an appropriately experienced and qualified adviser. I am not an IFA.