Over 55s hoping to enjoy a 'golden retirement' are facing poverty

kabayiri

Harry_Powell wrote: »

They already do. When you turn 65, you get an Age Related Allowance of £5k which, coupled with the normal tax free allowance of £5k, allows people of retirement age to earn £10k tax free.

Typically the state pensions come to £6k per year, so a retired person could make an extra £4k completely tax free. Retired people also don't pay national insurance so there is another large tax saving.

Thanks for that Harry.

It is useful to know. I don't believe it has to be doom and gloom for pensioners if we give them a small amount of support and help, like you describe.

silvercar

carolt wrote: »

Well, there always has been a private rented sector - that's not new.

Whilst I applaud your generosity in wanting and being prepared to help your children out when the time comes, do you think it's possible that they might actually prefer to be in a position to stand on their own two feet?

I'd much rather prices were lower and I could afford to buy easily; the thought of relying on family is not something I would wish to do.

I'd only be putting the children into the position that I was in, no student loan and a home they can afford when on a reasonable salary. They won't be relying on me to provide for them, but I would want to help them start out if I'm in a position to do so.

If they can only afford to buy or rent somewhere grotty/ unsuitable location and my giving them a deposit means they can get somewhere better, then I or they wouldn't have a problem with it. Doesn't mean I would spoon feed them for ever, but I don't see anything wrong with helping out family.

I'm already part of the uncaring generation because I had free university education and bought when house prices were low, now I'm expected to keep any savings to myself because it would be an unfair advantage if I helped my own children!

worldtraveller

Kohoutek wrote: »

I'm assuming you're some years off until retirement. Since the country has been essentially bankrupt since late 2008, I wouldn't hold out hope that a state pension or other benefits that pay enough to live off will exist in the coming decades.

Just to update the above and give a further perspective, a Centre for Policy Studies report in October 2009 states that at the end of August 2009, the UK’s Public Sector Net Debt (including financial interventions) was £805 billion. This is equivalent to £31,320 for every home in the country, or 57.5% of GDP.

However, It also states that the official figures do not take into account the full cost of projects financed through the PFI, nor unfunded public sector pension liabilities, nor contingent liabilities such as Network Rail nor the cost of recent interventions in the financial sector. These hidden liabilities total £1,395 billion (100% of GDP).

The true public debt is therefore £2,200 billion (157% of GDP or £85,610 per household). This is an increase of £346 billion since 2008, when the true level of debt was £1,850 billion (127% of GDP).

Naturally, even these figures will need to be revised up further.

Kohoutek

worldtraveller wrote: »

Naturally, even these figures will need to be revised up further.

I'm sure Mervyn is revving up the printing presses as we speak. It's clearly the only way out for people who aren't still asleep.

C_Mababejive

Harry_Powell wrote: »

(I know this was a rhetorical question...but I can't help myself)

"They" = "Us, the tax payer"

It seems that yet another person has decided to live life for today and let someone else pay for them tomorrow. Excellent. Why not go further and go on benefits, we can support you* through your 'working life' too!

* aimed not at Thrugelmir, but the person he is responding to...

But ive learned lessons in these past two years.

Here they are...

Live for today as much as you can
If you get into debt it doesnt matter
Dont save for old age as your savings will be used directly and indirectly to help the spenders and wastrels
You dont live forever and if you die massively in debt,who cares?
Make sure you hide as much of your assets as possible so that when you come up to retirement,you can make the most of the social/welfare and benefits system whilst actually being able to enjoy the fruits of your labours when you retire.

Kohoutek

C_Mababejive wrote: »

Live for today as much as you can
If you get into debt it doesnt matter
Dont save for old age as your savings will be used directly and indirectly to help the spenders and wastrels

Spenders and wastrels, you mean like the people who live only for today and get into debt without thinking about the consequences?

If everyone followed your philosophy the economy would collapse. Sentiments like that are the reason we're in the economic crisis we are today. There won't be a pensions or benefits system that has any resemblance to the one today when you retire.

When people like Gordon Brown follow your philosophy, that's when the really big problems start.

C_Mababejive

Kohoutek wrote: »

Spenders and wastrels, you mean like the people who live only for today and get into debt without thinking about the consequences?

If everyone followed your philosophy the economy would collapse. Sentiments like that are the reason we're in the economic crisis we are today. There won't be a pensions or benefits system that has any resemblance to the one today when you retire.

When people like Gordon Brown follow your philosophy, that's when the really big problems start.

But that IS exactly where we are...and yet at the moment..i am a net contributor to trying to fix the problem. My savings and investments are pointing down hill,im paying tax and will probably have to pay more,i cant even take a holiday without being fleeced on exchange rates...but I'm not the one living in the big fat house with the big fat mortgage and the big fat Beemer on my drive,,all on credit. I'm the one with zero debt. Everyone wants MY money to prop up the spenders and give credibility to UK Debt PLC but they want my money for nothing...or close to it.

Not going to happen.

Better to spend spend spend and join the national debt club. At least you will have a good time getting there.

Harry_Powell

C_Mababejive wrote: »

But that IS exactly where we are...and yet at the moment..i am a net contributor to trying to fix the problem. My savings and investments are pointing down hill,im paying tax and will probably have to pay more,i cant even take a holiday without being fleeced on exchange rates...but I'm not the one living in the big fat house with the big fat mortgage and the big fat Beemer on my drive,,all on credit. I'm the one with zero debt. Everyone wants MY money to prop up the spenders and give credibility to UK Debt PLC but they want my money for nothing...or close to it.

Not going to happen.

Better to spend spend spend and join the national debt club. At least you will have a good time getting there.

Good luck with that.

Old_Slaphead

C_Mababejive wrote: »

Better to spend spend spend and join the national debt club. At least you will have a good time getting there.

Spend spend spend and you'll acquire many things you don't really need or appreciate.

Having some savings put aside gives you choices - no savings and you have to make do with what you're given. Future governments may not be so benevolent and the retirement age may well be north of 70.

PasturesNew

Harry_Powell wrote: »

unless we arrange our tax affairs correctly. A combination of state pensions paying £6k, personal pension paying £4k and ISA savings that are tax free can result in a retirement income of £40k or more with zero tax (providing you put enough away in your ISAs!)

I can't see that!!! However much would one have to save to get that? That's about 1.5x median salary for a full-time worker.

With £6k + £4k out of the equation, it'd take an ISA income of £30k/year, at 5% interest (say), that'd mean having squirrelled away £600k. So far, in my entire life, I've earnt/actually had in my hand under half of this vast amount.

I got my first ISA in my late 40s, ONLY after I'd sold my house ... never had any money before, never had enough left over for savings.