Current a level students won't get a pension till 77... Lets cut boomers pensions NOW

coastline

A few links about public and private sector pensions...
The median average public sector pension is less than £6,000 a year before tax...hardly this golden handshake that many claim..
Remove the state pension and we are back to square one...most people won't have enough to live on...you'll need to combine the two for many decades yet.
If public sector workers didn't have a final salary pension then they would need an alternative... or a government top up..
Yes there'll be some who have been working for the government a lifetime.. but the £6,000 figure suggests many haven't.
The idea at present is to produce a minimum state pension of £155 a week...and for everyone to contribute to a scheme to top this up...public and private..

http://www.bbc.co.uk/news/business-15925017

this link shows the different sectors..and schemes..

http://www.bbc.co.uk/news/business-10912958

CLAPTON

Thrugelmir wrote: »

Maybe so. Auto enrollment is the start of the way forward. Too late for some I suspect though.

maybe so

we will have to see :-

1. what the take up for the new auto enrollment is

and

2. we will need to see whether existing decent pensions schemes deduce the employer contributions to the new legal minimum

what's your guess?

Thrugelmir

CLAPTON wrote: »

1. what the take up for the new auto enrollment is

and

2. we will need to see whether existing decent pensions schemes deduce the employer contributions to the new legal minimum

what's your guess?

What's required is a cultural change of attitude. My late father encouraged me to start a basic plan when i first started work. My son I did likewise. At the end of the day its personal choice.

robmatic

coastline wrote: »

A few links about public and private sector pensions...
The median average public sector pension is less than £6,000 a year before tax...hardly this golden handshake that many claim..
Remove the state pension and we are back to square one...most people won't have enough to live on...you'll need to combine the two for many decades yet.
If public sector workers didn't have a final salary pension then they would need an alternative... or a government top up..
Yes there'll be some who have been working for the government a lifetime.. but the £6,000 figure suggests many haven't.
The idea at present is to produce a minimum state pension of £155 a week...and for everyone to contribute to a scheme to top this up...public and private..

http://www.bbc.co.uk/news/business-15925017

this link shows the different sectors..and schemes..

http://www.bbc.co.uk/news/business-10912958

That meagre £6000 pa would cost close to £200000 to provide if you purchased an equivalent annuity on the open market, or perhaps someone would need to own an investment property or two to provide a similar level of income.

BertieUK

CLAPTON wrote: »

is this a joke?

pension payments receive tax relief now (and have done for at least 50 years)

virtually all the evidence is that personal (private) pensions will die out within 30 years

I find your manner of wording is getting rather cold. No this is no joke as you put it...

Pensions as we know them today will not be affordable within the next couple of decades and we will not be as reliant upon the state then as we are now.

coastline

robmatic wrote: »

That meagre £6000 pa would cost close to £200000 to provide if you purchased an equivalent annuity on the open market, or perhaps someone would need to own an investment property or two to provide a similar level of income.

The government doesn't sell Annuity plans...comes out of taxpayer funds annually.
I suppose you could say that about Job Seekers Allowance...£70 a week...£120,000 Annuity ??
The point is if pensioners don't have some sort of plan...public or private...then the taxpayer has to provide income support.

kabayiri

Thrugelmir wrote: »

What's required is a cultural change of attitude. My late father encouraged me to start a basic plan when i first started work. My son I did likewise. At the end of the day its personal choice.

It's going to take quite a shift I suspect.

I remember seeing Ros Doyle a few years back on telly advising a small group of electricians (I think) advising them on personal pensions.

One guy was 28; one was 44.

For a modest pension pot, she advised the younger to put £250 away per month, and the older £450.

They both laughed it off and proclaimed they didn't have that level of spare cash.

My point is that the approach she offered didn't engage the people being advised.

She should have asked them all how much they could/would commit to per month for pension provision, being realistic, and then inform them what that would buy them under best/medium/worst case scenarios.

grizzly1911

robmatic wrote: »

That meagre £6000 pa would cost close to £200000 to provide if you purchased an equivalent annuity on the open market, or perhaps someone would need to own an investment property or two to provide a similar level of income.

Aren't current annuity rates some of the worst they have ever been?

They are also based on providing a pension for someone alive now.

The government "pot" includes all those contributions for those that will never receive a pension.

I wonder if the pension suggested is a median or average figure?

One modest investment property at 60/70% of the figure suggested would do it.

With a lot low paid, public sector, jobs now been done by private sector firms it will be interesting to see how the burden of lower pension provision is funded /topped up by the state in future years.

Public sector workers do contribute to their "fund", could be seen as extra tax.

princeofpounds

The government doesn't sell Annuity plans...comes out of taxpayer funds annually.
I suppose you could say that about Job Seekers Allowance...£70 a week...£120,000 Annuity ??

You can capitalise any steady ongoing revenue stream to find it's value.

So yes, the annuity value of JSA is £120k (or it would be if the average person on JSA receives it for as long as the average retiree lives, which is a bit of a funny assumption).

Each incremental £6000 pension added is financially equivalent to adding a £200k debt at the rate of the annuity. It's a liability, same as debt.

Saying it doesn't matter because it comes out of taxpayer funds annually is like saying it doesn't matter what the national debt is because we can pay the interest.

It is the liability of the worst kind, an unfunded liability. Although the government accounts claim it is funded... only with a 'guarantee' i.e. an IOU, which is in reality a government debt to its future pensioners. (Not included in official debt statistics of course)

Anyway, the whole point is that looking at public pensions in this way is perfectly valid - and no, I am not someone who thinks they should all be ripped up.

And the £6k figure is not a particularly accurate one in any case, because people jump around between different jobs and pension schemes and many people will be receiving more than one public sector pension.

princeofpounds

The government "pot" includes all those contributions for those that will never receive a pension.

Hint: there is no pot. Except at the local government level, most public pension programs essentially are run as 'pay as you go'. The small (relative to benefits accrued) contributions of current and previous workers are used to spend on current general expenditure, whilst the larger contributions that will be needed in the future (to actually pay for the benefits) are laid at the door of young and future workers.

As private eye would say, 'Trebles all round!'