the answer to the pension crisis...

lemonjelly

PasturesNew wrote: »

My plan was always: buy a house, downsize to a retirement place when I'm about 70.... they tend to be cheaper, so there's a bit of a cash pot then. But most people still try to hang onto a house that's too big and hard to maintain rather than downsizing for some odd reason.

the_ash_and_the_oak wrote: »

totally agree w this - kinda weird when my gparents STR they were so 50-50 on it for a while - a real wrench to leave it but at same time so many worries about the place. So glad it worked out imo

Depends on the type of property i believe. Bungalows don't tend to be cheaper - more expensive imo.

When I worked in social housing, our sheltered accommodation was difficult to let sometimes. Most of the time, because it was poor & didn't fit in with peoples needs. However, the biggest reason retired people gave for turning down the property was that they didn't know where they'd put all the stuff they'd accumulated oer the years, which only just about fit in their 3 bed house.

Downsizing frequently involves getting rid of stuff, having a clear out. It appeared that many were reluctant to do this.

kabayiri

I do not have the ability to predict the house market situation when I retire. I'm sorry, but it's a weakness of mine.

Also, I can not guarantee against the next recessionary downturn occurring when I need to flog my house to generate this retirement fund.

There seem to be a few holes in this HPI plan then, unless we are willing to take a punt.

baileysbattlebus

ukcarper wrote: »

That's my intention maybe even earlier but like you just for a bit of extra cash. I wouldn’t like that to be my only source of income as when you take into account moving fees the average person won't get a vast sum of money.

This is our plan - but going to start this time next year or spring of the year after. We haven't counted on any money we might get from the house, because we don't know how much there will be. We don't know what it will sell for or what a new house will cost.

We are both mid 50's and have planned on a retirement in the 2010 or early 2011 for years. We both have decent final salary pensions - which is the main basis for retirement - without those or another income we wouldn't be thinking about retiring.

The only good thing about the house is that it is in quite an expensive part of the country and we will be moving to an area that is considerably cheaper - so the chances are there will be money left over.

The house move we wanted to do while we were still young enough to be bothered and able to cope with it. It can be quite stressful for an older person to move - even in the same area.

We've been in this house for over 16 years and I'm actually looking forward to getting rid of the "stuff" we have accumulated over that time - in another 15 years I might not want to and might feel more attached to it than I do now.

Currently the plan is to sell the house - move into rented in our chosen area and then look for somewhere to buy.

Old_Slaphead

kabayiri wrote: »

I do not have the ability to predict the house market situation when I retire. I'm sorry, but it's a weakness of mine.

Also, I can not guarantee against the next recessionary downturn occurring when I need to flog my house to generate this retirement fund.

There seem to be a few holes in this HPI plan then, unless we are willing to take a punt.

Are their any alternatives now that guaranteed pensions are unlikely to provide a backdrop for security for future generations?

Stockmarket, annuities and many other investments have similar problems regarding unpredictability and how well they will measure up in future

Masomnia

The answer should be that we all have to work longer. Shame that it's not politically palatable.

lemonjelly

baileysbattlebus wrote: »

This is our plan - but going to start this time next year or spring of the year after. We haven't counted on any money we might get from the house, because we don't know how much there will be. We don't know what it will sell for or what a new house will cost.

We are both mid 50's and have planned on a retirement in the 2010 or early 2011 for years. We both have decent final salary pensions - which is the main basis for retirement - without those or another income we wouldn't be thinking about retiring.

The only good thing about the house is that it is in quite an expensive part of the country and we will be moving to an area that is considerably cheaper - so the chances are there will be money left over.

The house move we wanted to do while we were still young enough to be bothered and able to cope with it. It can be quite stressful for an older person to move - even in the same area.

We've been in this house for over 16 years and I'm actually looking forward to getting rid of the "stuff" we have accumulated over that time - in another 15 years I might not want to and might feel more attached to it than I do now.

Currently the plan is to sell the house - move into rented in our chosen area and then look for somewhere to buy.

Bit in bold made me laugh.

It amazes me, the different characters we are. My nan was terrible, never held on to anything. I'd go round at christmas & give her a box of chocs. The next day, my brother would go round with his kids. My nan would give them a box of chocs to go home with. Guess where she got the box from...:D

My mom is the opposite. Can't bear to throw things away.

My other half is a thrower. Thing is, 6 months later they're asking where X is, & I point out they threw it away.

I'm the opposite, I don't like to throw stuff away, & like to re-use where possible.

Me & my other half have tremendous rows (never that serious though) about what to throw & what not to throw.

We're a strange species.

Snooze

lemonjelly wrote: »

Bit in bold made me laugh.

It amazes me, the different characters we are. My nan was terrible, never held on to anything. I'd go round at christmas & give her a box of chocs. The next day, my brother would go round with his kids. My nan would give them a box of chocs to go home with. Guess where she got the box from...:D

My mom is the opposite. Can't bear to throw things away.

My other half is a thrower. Thing is, 6 months later they're asking where X is, & I point out they threw it away.

I'm the opposite, I don't like to throw stuff away, & like to re-use where possible.

Me & my other half have tremendous rows (never that serious though) about what to throw & what not to throw.

We're a strange species.

My way of keeping the level of tat in check is to pick 'whatever' up and ask myself if I'm realistically going to use it again and when was the last time I used it. 99% of the time the answers are 'no' and 'can't remember' so I move on to the next step of 'is it realistically worth anything on Ebay/free-ads?'. Again, 99% of the time the answer is 'no' so into the bin it goes. It actually works really well and as a result I can fit all my possessions into the back of a tranny va, in one go.

R

kabayiri

Old_Slaphead wrote: »

Are their any alternatives now that guaranteed pensions are unlikely to provide a backdrop for security for future generations?

Yes!

Make it economical for older people to live. I'm not talking about discounts on beemers or yachts or anything like that. Then your average pensioner will be able to manage on less.

The success of free public transport for OAPs shows how well used these subsidies can be.

I suspect this idea doesn't really fit in with the pension industry though....

baileysbattlebus

lemonjelly wrote: »

Bit in bold made me laugh.

It amazes me, the different characters we are. My nan was terrible, never held on to anything. I'd go round at christmas & give her a box of chocs. The next day, my brother would go round with his kids. My nan would give them a box of chocs to go home with. Guess where she got the box from...:D

My mom is the opposite. Can't bear to throw things away.

My other half is a thrower. Thing is, 6 months later they're asking where X is, & I point out they threw it away.

I'm the opposite, I don't like to throw stuff away, & like to re-use where possible.

Me & my other half have tremendous rows (never that serious though) about what to throw & what not to throw.

We're a strange species.[/QUOTE

OH is the hoarder - I'm more of a thrower outer - but it can cause "words" if I want to get rid of stuff and he doesn't. So into the loft it goes -

Can you believe he has kept every single payslip he has had since he started this job - over 30 years ago - all in a couple of boxes in the loft. All neatly bundled and labelled by year - they might be good for a laugh when we look at what he used to earn.

Old course work - the equipment is now obsolete -

Old school books belonging to the kids - the eldest is 30.

A couple of boxes we never even opened when we moved from our last house -

Fortunately it's the loft not the actual house - but it's a big loft and it's full.

I keep trying to prepare him by saying "we'll need a couple of skips"

The last time I decided to have a go at getting rid of "stuff" all he would agree to were some empty PC, DVD player and TV boxes - that he thought we wouldn't need any longer - some of the stuff we had already replaced.

Thrugelmir

lemonjelly wrote: »

Appears to be HPI, according to most members of the general public (based on a poll admittedly)

http://news.bbc.co.uk/1/hi/business/8388006.stm

Clearly the vast majority of the public are still believing that HPI will return, & will fund their retirment, pension etc.

NB those polled were all over 50, therefore have experienced previous recessions. Despite this, the majority still expect HPI to return.

What really surprised me, is that given their homes are essentially their retirement fund, the poll asks what they will do to remedy the losses over the past 12+ months. Almost a third have responded with "do nothing & wait for prices to re-correct in the coming months".

Hmmm. Are thos on here who anticipate further falls deluded? It seems clear they are in the minority after all.

Further, were the recent falls just a blip, & the correction is actually happening now to get us back to normal?

People over 50 are more likely to have benefited from being home owners for 15-20 years and have benefited enormously from the rise in house prices between 1999 and 2004. Taking the opportunity to trade up and extend their homes.

The question is who are they going to sell to? Where's the trade up market.

If anything they will be competing with FTB's for smaller and cheaper property when downsizing as well.

Would also be interesting to now how many of those polled live in the South East, and intend to take advantage of regional variances in prices.

As moving in itself doesn't generate a huge amount of capital to live on , over say a 25 year retirement period.