Soon every employee must pay into a pension - will you opt out? Poll discussion

Tammer

Hi,

Thought I'd try to clear up a couple of things for the people opting out:

1. This doesn't replace the basic state pension. It is a top up so it's not a case of "I already paid for this, why am I paying more?".

2. Your employer will have to contribute to the scheme if you do. If you opt out, you are effectively refusing part of your salary.

3. If you are already in a good pension scheme, you will not have to pay into this - unless your employer decides to bin your pension scheme in order to offer the new minimum standard.

pinkshoes

I'm 30, and have already accepted that unless I want to work until I die, I will either need a decent private pension, or a second home owned outright. I pay 7%, and the (private) company also contributes 7%.

What I find frustrating is that in the private sector, the best promotions and pay rises come from moving company, so they need to make it much simpler to transfer the private pension from one company to another.

It doesn't matter what I contribute, as I know that I will NEVER get the same pension that a public sector person gets, and I think all public sector pensions should be axed for anyone under 55, and replaced with a contribution pension, just like in the public sector. We just can't afford it any more, and it's bankrupting our country.

Paul_Herring

Gah! wrong button.

pinkshoes wrote: »

I'm 30, and have already accepted that unless I want to work until I die, I will either need a decent private pension, or a second home owned outright.

2nd home isn't a given route to a prosperous retirement.

I pay 7%, and the (private) company also contributes 7%.

To not contribute to that pension means you're not claiming a (admittedly, deferred) 7% wage.

What I find frustrating is that in the private sector, the best promotions and pay rises come from moving company, so they need to make it much simpler to transfer the private pension from one company to another.

Is it really that difficult? I'm in the process of sorting out pension provision with my current employer, and (at first blush) they're more than happy to put contributions into the fund I have with my previous employer.

It doesn't matter what I contribute, as I know that I will NEVER get the same pension that a public sector person gets, and I think all public sector pensions should be axed for anyone under 55, and replaced with a contribution pension, just like in the public sector. We just can't afford it any more, and it's bankrupting our country.

Well, to take MPs as an example, I'm sure they're so underpaid, and so lacking in ability to get expenses back, that your idea would be deemed to be inappropriate.

[Deleted User]

Tammer wrote: »

2. Your employer will have to contribute to the scheme if you do. If you opt out, you are effectively refusing part of your salary.

3. If you are already in a good pension scheme, you will not have to pay into this - unless your employer decides to bin your pension scheme in order to offer the new minimum standard.

I pay into a company pension - are we saying I won't be auto-enrolled into this 2nd state pension?

If I decide to pay into it am I right in thinking my employer has to pay into it as well?

I currently pay 6% into my pension and my employer matches upto 5%. I suppose I could reduce it to 5% and pay 1 or more % into this scheme and get more 'free' money from my employer. This obviously isn't going to take into account which pension performs better and ultimately makes more money. Difficult decision.

pinkshoes

Paul_Herring wrote: »

2nd home isn't a given route to a prosperous retirement.

Prosperous? As it currently stands, many people are going to end up in poverty!!

I don't care about being prosperous when I retire. I just want enough money to run a car, eat well, heat a small home, visit my family, and have a few hobbies.

A second home owned outright would at least give a reasonable monthly income if rented out, or a lump sum if sold. People always need somewhere to live, so I know many people who see this as a much safer and more reliable option than a pension.

Uni_Admin

Anything that encourages people to save for retirement..and makes employers contribute towards it are ultimatley a good idea.

Yes some people are lucky enough to have a well funded final salary pension (like me in my current job..not bad for a 25 yo)...and others may be better putting their money in to other forms of invesments and savings. But for far too many people this will be a fantastic opportunity to have an income on top of the state pension.

While it would be nice for us to rely on a state pension alone, anyone who knows someone who currently subsits on this meagre state handout cannot seriously hope that the small pension is all they wish to get by on in their old age.

First we had ISA's now we have NEST...I say bring on more of the same!

Paul_Herring

Deleted_User wrote: »

I pay into a company pension - are we saying I won't be auto-enrolled into this 2nd state pension?

It's not a second state pension, it's a personal pension for companies that don't currently provide any pension provision for their employees.

If I decide to pay into it am I right in thinking my employer has to pay into it as well?

Your employer already provides a pension - what this new scheme does is force those not already contributing to their employees pensions to contribute 3%.

I currently pay 6% into my pension and my employer matches upto 5%.

What might happen is that your employer may reduce their contribution to the 3% level, and still require you to pay in 4%.

I suppose I could reduce it to 5% and pay 1 or more % into this scheme and get more 'free' money from my employer.

It won't work like that.

[Deleted User]

Paul_Herring wrote: »

It's not a second state pension, it's a personal pension for companies that don't currently provide any pension provision for their employees.

So who decides where the money is invested?

Paul_Herring wrote: »

Your employer already provides a pension - what this new scheme does is force those not already contributing to their employees pensions to contribute 3%.

So am I right in thinking that given my employer provides a pension they don't have to provision this new pension scheme? Or is this a choice for the employer?

Paul_Herring

Deleted_User wrote: »

So who decides where the money is invested?

Presumably the employee.

So am I right in thinking that given my employer provides a pension they don't have to provision this new pension scheme? Or is this a choice for the employer?

It'll be left up to the employer in those cases where they already provide a scheme that already contributes at least 3%.

Shopaholic10_2

pinkshoes wrote: »

It doesn't matter what I contribute, as I know that I will NEVER get the same pension that a public sector person gets, and I think all public sector pensions should be axed for anyone under 55, and replaced with a contribution pension, just like in the public sector. We just can't afford it any more, and it's bankrupting our country.

I am not normally a poster on these forums but felt that I had to reply to this tread.

I'm 30 years old and I've worked for public sector since leaving college at 18. I currently pay £300 per month into my 'public sector pension' and I have paid 6.8% every month over the life of my career.

I feel slightly upset when people imply that all public sector workers get a good pension for nothing, my pension has already cost me a lot of money over the years and will continue to do so until I am 'allowed' to retire when I'm 65, by then (supposing I live long enough) I will have paid enough in to my pension to pay for my retirement for over 10 years without even touching the amount my employer is contributing.

I'm actually at a loss as to why hard working public sector employees like myself get a bad rap because of a few lying, scamming MP's?