MSE News: How to defuse the pension time bomb

dunstonh

The additional problem is when people with little knowledge who think they know a lot make incorrect decisions. i.e. thinking low interest rates is a reason not to pay into a pension (that will typically not be investing much in deposits anyway).

bigbigmamamoo

I thought it was interesting that there was no real discussion of how much pension income people need. I think the report was based on a pension income of 70% of salary, but surely many people who have saved for their retirement aren't aiming that high and so would show up as having a shortfall when in fact they are quite happy with their planned 50% of salary

Paul_Herring

bigbigmamamoo wrote: »

I thought it was interesting that there was no real discussion of how much pension income people need.

There is no discussion, because they made an assumption rather than researching it.

I think the report was based on a pension income of 70% of salary

Not even close - from the above link: Low income: 90%; mid income: 65%; high income : 55%

Of course, it's not readily obvious as to what constitutes "low, mid or high" income.

Nor do they, (as far as I can tell) make any observations on potential debt levels at retirement (I'm thinking of things like mortgages/long term credit card debt etc.)

bigbigmamamoo

Paul_Herring wrote: »

There is no discussion, because they made an assumption rather than researching it.


Not even close - from the above link: Low income: 90%; mid income: 65%; high income : 55%

Of course, it's not readily obvious as to what constitutes "low, mid or high" income.

Nor do they, (as far as I can tell) make any observations on potential debt levels at retirement (I'm thinking of things like mortgages/long term credit card debt etc.)

even worse than I thought. The report is basically just saying: people aren't giving us as much money as we want them to.

me_cynical?

dunstonh wrote: »

The additional problem is when people with little knowledge who think they know a lot make incorrect decisions. i.e. thinking low interest rates is a reason not to pay into a pension (that will typically not be investing much in deposits anyway).

Do you ever wonder why Pension Companies, IFA's and their ilk are regarded as being as honest as Politicians and Estate Agents?

My little knowledge includes mis-selling of financial instruments such as endowments and pensions.

Low interest rates are a disincentive to save in any form. The fact that when you save you are later penalised and those who routinely spend 105% of their income seem to gain at the expense of those who have made provision for themselves doesn't help.

Articles like this are just sales efforts for your industry, perhaps your industry should have more regard for public perception.

Incidentally my own portfolio is mixed and accessible without the boundaries of a pension plan that wouldn't be accessible until...

dunstonh

Do you ever wonder why Pension Companies, IFA's and their ilk are regarded as being as honest as Politicians and Estate Agents?

Dont put your perceptions on to anyone else. You are not reflective of the general public.

My little knowledge includes mis-selling of financial instruments such as endowments and pensions.

So you let events of 20-30 years ago impact on your decisions today? Do events further back in history impact you in the same way?

Low interest rates are a disincentive to save in any form.

No they are not. Not when you utilise things that have nothing to do with interest rates.

Articles like this are just sales efforts for your industry, perhaps your industry should have more regard for public perception.

The information in this thread didnt even make the financial press. No-one was interested. The only place I have seen any reference to it is here.

me_cynical?

EdCov wrote: »

If we as a country cannot enable people to work and earn a decent pension, we are not much of a country. The fact that many people who work hard in this country will never have a decent pension, is a shame on us all.

Rant over, sorry.

The fact that no government has lifted the retirement age in line with increasing life expectancy might be a partial cause of this as is the continued sex discrimination in allowing women (who have a higher life expectancy) to retire 5 years before us gentlemen.