MSE News: Personal pension contributions fall

Former_MSE_Helen

This is the discussion thread for the following MSE News Story:

"The number of people paying into personal pensions dropped sharply last year in the wake of the recession ..."

Read the full story:

Personal pension contributions fall

Reaper

Is it just me confused by this story?

Total contributions dropped by £2 billion from £20.9 billion in 2007/08 to £18.7 billion in 2009/10

Meanwhile:

However, total contributions to private (non-state) pensions rose to £85.6 billion in 2009 from £83.2 billion the previous year

So hang on. People put £2bn less in their company schemes and £2bn more in their private schemes. Doesn't that balance out?

dunstonh

I think its a typo.

However, total contributions to private (non-state) pensions rose to £85.6 billion in 2009 from £83.2 billion the previous year

Private pensions would indicate personal pensions, SIPPs, stakeholders and group personal pensions. So, on the one hand it says personal pensions and stakeholders dropped but on the other (which includes the same types and a few more types) increased. I think the latter should be private sector occupational pensions rather than private pensions.

Pension contributions typically drop in a recession. However, the increasing number of companies offering money purchase schemes in readiness of being forced to or the switch from defined benefit to defined contribution would be the most likely reason for increase.

Reaper

You could be right. I see they just copied and pasted the Press Association story which has the same text on other sites, with the same mysterious figures. It's a shame they didn't read it first and analyse it as I thought that was what the News section was all about.

Queenriderbrekke

Quote Pensions minister Steve Webb says there is a need to "inspire a culture of saving"

I sometimes wonder why I am saving with pensions and savings rates at rock bottom!

Turnbull2000

And do they really expect the increasing numbers of households pushed into private renting to save for a pension? Unless you can set aside a small fortune each month, I don't see the point for renters. It'll just be swallowed up by your landlord. May as well depend on housing benefit.

jamesd

Queenriderbrekke wrote: »

I sometimes wonder why I am saving with pensions and savings rates at rock bottom!

Pensions rates aren't at rock bottom. It's one of the better times for pension investing, with perhaps the period at the end of 2008 and first half of 2009 being the best those paying in now will ever see in their lifetimes for adding new money to a pension.