How big should my pension pot be ?

marklv

"But in my mind, the fact that I am working hard to pay for your retirement as well as my own leaves a nasty taste in my mouth. The nation's debt burden and high spending - sharply personified by public sector pensions on the one hand and welfare dependancy on the other - are adding several years to my working life."

I think you have a point on welfare dependency, and I would agree with you here. But I think all the fuss about the public sector is largely an exaggeration generated by the tabloid press. Let's agree to disagree and put the issue to bed.

Old_Slaphead

marklv wrote: »

I think you have a point on welfare dependency, and I would agree with you here. But I think all the fuss about the public sector is largely an exaggeration generated by the tabloid press. Let's agree to disagree and put the issue to bed.

Not wanting to prolong the debate any longer than necessary I'd very much like to hear why you consider
(a)the public sector pension issue to be exaggerated by the tabloid press and
(b)why/how it is affordable both financially and morally.

In last night's newsnight both Tory & Liberals recognised the need of serious reform going forward - however Liam Byrne woundn't/couldn't admit to anything (not much point in him being on really).

To support the fact that it's not only a tabloid issue - here's an extract from this week's ST which just about says it all....

http://www.timesonline.co.uk/tol/comment/leading_article/article6823292.ece

Harry_Powell

bendix wrote: »

I would like to publicly state that I want to see the public sector cannibalised.

No offence marklv, because I'm sure you're a genuine bloke. But in my mind, the fact that I am working hard to pay for your retirement as well as my own leaves a nasty taste in my mouth.

The nation's debt burden and high spending - sharply personified by public sector pensions on the one hand and welfare dependancy on the other - are adding several years to my working life.

I have a slightly different standpoint where I think in all fairness that pension rights already accrued should be honoured, but that the FS schemes should be closed to existing and new members and everyone should then be enrolled in Money Purchase schemes (with the Employer contribution set to a private sector average). This is what is happening in the private sector - no one is losing existing pension rights, they are just having future pension rights changed.

I also believe that early retirement should be subject to the same actuarial calculations as occurs in the private sector (if it's not already).

Basically, we should move to a level playing field where there is no discernable difference between the average private and average public sector pension.

LABW123

OK, now I'm panicking! I am 35 and have no pension at all! :rolleyes:
I am seeing an IFA soon, but any suggestions of what I need to do? (short of living off nothing and putting my whole monthly wages into a pension to catch-up)

I have read what you have all said about the state pension, as this may not be around when we all get to pension age - can we opt out now and take it save ourselves?

Thanks

marklv

LABW123 wrote: »

OK, now I'm panicking! I am 35 and have no pension at all! :rolleyes:
I am seeing an IFA soon, but any suggestions of what I need to do? (short of living off nothing and putting my whole monthly wages into a pension to catch-up)

I have read what you have all said about the state pension, as this may not be around when we all get to pension age - can we opt out now and take it save ourselves?

Thanks

I was exactly in your position at your age. As I wasn't earning much until around 33-34 years of age I didn't care about pensions - I had enough trouble paying the rent.

The good news is that you are not too old to start a pension and end up with a good payout. You probably have at least another 25 years of working life ahead of you, and that's enough to build up a good pension.

There is a great pension calculator here: http://www.h-l.co.uk/pensions/pension-calculator

Note that you can change the parameters under which the calcualation is made. Just by getting rid of the widow's pension you can boost the payout by quite a bit.

bendix

Harry_Powell wrote: »

I have a slightly different standpoint where I think in all fairness that pension rights already accrued should be honoured, but that the FS schemes should be closed to existing and new members and everyone should then be enrolled in Money Purchase schemes (with the Employer contribution set to a private sector average). This is what is happening in the private sector - no one is losing existing pension rights, they are just having future pension rights changed.

.

Completely agree Harry. To retrospectively take away pension rights accrued already would be grossly unfair to those in the public sector.

A level playing field is not asking too much.

marklv

Old_Slaphead wrote: »

Not wanting to prolong the debate any longer than necessary I'd very much like to hear why you consider
(a)the public sector pension issue to be exaggerated by the tabloid press and
(b)why/how it is affordable both financially and morally.

In last night's newsnight both Tory & Liberals recognised the need of serious reform going forward - however Liam Byrne woundn't/couldn't admit to anything (not much point in him being on really).

To support the fact that it's not only a tabloid issue - here's an extract from this week's ST which just about says it all....

http://www.timesonline.co.uk/tol/comment/leading_article/article6823292.ece

I don't want to keep going round in circles with this discussion. I accept that some changes need to be made to public sector pensions; what I do not accept is that there is a need to reduce these to almost nothing, which is what some people here seem to be advocating. Comparisons with the private sector are not relevant because there are several different schemes in the private sector, all offering a variety of levels of benefits.

My suggestion, which I feel would be fair and moral, is to introduce a common scheme for all public sector workers (other than police, firepeople and the military) which would offer the same benefits as the average pension benefits of all FTSE 100 companies. However, this should apply to new members only, not to existing staff. Demolishing the benefits of existing staff is morally wrong, as these people have made future plans on the basis of their expected pension benefits. The uniformed public sector people would also have similar changes, but slightly modified to cater for the earlier retirement age (which is needed due to the much higher physical fitness and health standards required for uniformed services).

marklv

"I have a slightly different standpoint where I think in all fairness that pension rights already accrued should be honoured, but that the FS schemes should be closed to existing and new members and everyone should then be enrolled in Money Purchase schemes (with the Employer contribution set to a private sector average). This is what is happening in the private sector - no one is losing existing pension rights, they are just having future pension rights changed. "

This is a point with which I disagree emphatically. To make changes that affect existing members is totally immoral and wrong. Many hundreds of thousands of people have already made firm plans on the basis of expected benefits, and to change these would ruin the lives of these people. NO! NO! AND NO AGAIN!! To paraphrase Charlton Heston: YOU'LL TAKE MY PENSION AWAY FROM MY COLD DEAD HANDS!

marklv

bendix wrote: »

Completely agree Harry. To retrospectively take away pension rights accrued already would be grossly unfair to those in the public sector.

A level playing field is not asking too much.

It's not just grossly unfair, but illegal.

Old_Slaphead

marklv wrote: »

This is a point with which I disagree emphatically. To make changes that affect existing members is totally immoral and wrong. Many hundreds of thousands of people have already made firm plans on the basis of expected benefits, and to change these would ruin the lives of these people. NO! NO! AND NO AGAIN!!

Well Mr Brown decided he could change the rules for private sector pensions to the point where he's effectively rendered them obscure. Why should public sector be indemnified from any hardship.

Our retirement plans have to be put back several years to pay for Brown's abysmal custody of the economy and his tax theft from pension funds (presumably to subsidise your increasingly generous schemes).

Preserve existing public sector accruals by all means but future provision for all existing & future members should be an average of FTSE100 employer contribs. I suggest that that would be about 5 0r 6%. Wait until you get the joy of seeing your funds plummet by 30-40% at the next stockmarket crash and you have to add a few years onto your working life (what will that take it to 61, 62 ????).

FWIW employees at many thousands of SMEs get NO employer contributions added.


Again FS pensions for 6 million is something that this country can't afford as it's adding around 25-30% to payroll costs, a deferred cost to be paid by future generations!