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

Lokolo

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.

A massive change.

I am 24 and out of my close friends only 2 of us are contribution. However he is only contributing 2% as thats "all he can afford". The others just don't have an interest, a couple would rather save for a house deposit.

A lot of them bought brand new cars in recent years.

Shows where the priorities lie. And these are intelligent people.

grizzly1911

princeofpounds wrote: »

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.

The BBC article quotes "The median average salary-linked public sector pension that is currently being paid out to a pensioner, is worth £5,600 a year."

From your point above are you suggesting this is wildly wrong or possibly a bit wrong?Is it more likely to be for a few high level jobs rather than the norm?

There are good number of part time jobs, broken/short contract pro rata,and 50% final salary link rate.

grizzly1911

Lokolo wrote: »

A massive change.

I am 24 and out of my close friends only 2 of us are contribution. However he is only contributing 2% as thats "all he can afford". The others just don't have an interest, a couple would rather save for a house deposit.

A lot of them bought brand new cars in recent years.

Shows where the priorities lie. And these are intelligent people.

Sounds like your friends are able to make a choice and decide, for many they can't afford that choice it is a case of having to live and make ends meet in the here and now never mind 40 years time.

I can also understand where people move jobs as I know individuals who have plans that have "suffered" in deferral.

I am not knocking making a pension provision but I can understand why people don't feel able to.

princeofpounds

From your point above are you suggesting this is wildly wrong or possibly a bit wrong?Is it more likely to be for a few high level jobs rather than the norm?

Well I have to admit it seems the BBC isn't quoting the stat I had seen before (and I thought was being used), but the number is pretty similar.

I don't think it is likely to be a totally wrong number, just not that accurate and biased to the downside. So 7,8,9k wouldn't surprise me.

I do know some senior (but not that senior - there are hundreds at this level) army officers who are getting something like 45k, index-linked, retire at 65 pensions. An annuity for that would be something like 3.5%.

That would require a private pension pot of.... 45 / 0.035 =

One point three MILLION pounds! (plus the retirement bonus)

As a retirement gift, that beats the hell out of a watch!

Even if you divide it over a 40 year career it's a 30k uplift to NET salary per year in today's money.

I don't want to pick on the army either, there are probably many many more civil servants than officers.

And it's not just a case of paying too much; part of the reason of why we arrive in this situation is the low interest rates designed to bail out homeowners. Many of these homeowners are the same people who are not failing to get the private pensions they hoped for, but they fail to realise that it's the flip side of the coin.

StevieJ

coastline wrote: »

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.

There are other alternatives.

grizzly1911

princeofpounds wrote: »

And it's not just a case of paying too much; part of the reason of why we arrive in this situation is the low interest rates designed to bail out homeowners. Many of these homeowners are the same people who are not failing to get the private pensions they hoped for, but they fail to realise that it's the flip side of the coin.

Thanks for the whole post.

I have made the your final point elsewhere on here. Current, to be, pensioners are paying the price for current policy as are pensioners who are seeing savings interest rates on the floor and capital being eroded by inflation and a deflated pound.

ruggedtoast

grizzly1911 wrote: »

Thanks for the whole post.

I have made the your final point elsewhere on here. Current, to be, pensioners are paying the price for current policy as are pensioners who are seeing savings interest rates on the floor and capital being eroded by inflation and a deflated pound.

You can't have your cake and eat it. If you want younger people to pay the £300,000 asking price for your house you paid £30,000 for, then you can't have interest rates at the 15% you'd like to make out on your savings.

GeorgeHowell

How many young people who cannot afford to raise the deposit on a home nevertheless have weddings that typically cost anything from £12,500 to £25,000, followed by honeymoons of maybe £5,000+ ? Regardless of who pays, going for a small wedding and modest honeymoon costing 10% of that, and putting the rest towards a deposit, would make a huge difference to its affordability.

ruggedtoast

GeorgeHowell wrote: »

How many young people who cannot afford to raise the deposit on a home nevertheless have weddings that typically cost anything from £12,500 to £25,000, followed by honeymoons of maybe £5,000+ ? Regardless of who pays, going for a small wedding and modest honeymoon costing 10% of that, and putting the rest towards a deposit, would make a huge difference to its affordability.

Further points deducted for failing to criticise the flagrant proliferation of iphones and hedonism in Magaluf by those f3ckless and empty headed young people you hate so much (but are also relying on to fund your retirement / buy your house when you dont want it / provide your health care etc)

2/10

grizzly1911

ruggedtoast wrote: »

You can't have your cake and eat it. If you want younger people to pay the £300,000 asking price for your house you paid £30,000 for, then you can't have interest rates at the 15% you'd like to make out on your savings.

Either way you will end up paying so you might as well knuckle down and get on with life. If I don't get returns on my pension investments and savings I might as well be a total drain on the next generations. House prices going up because of inflation is nothing new it has always happened.