How can Pension companies be allowed to keep you in the dark?

dunstonh

Ironically, I'm in another final salary scheme at the moment. As I joined it quite late on (I was 37) I doubt it will pay out enough to keep me in the manner to which I would like to become accustomed but will probably pay out too much to qualify me for any means tested benefits.

The forthcoming state pension changes also see the removal of most of the pension credit benefits.

Most defined benefit schemes cost the employee a fraction of the true cost of benefit. Many schemes would cost the equivalent of 25-40% of your income if bought via other means. Yet the employee pays in a much smaller amount. If that isnt enough for you to live on then your expectations are out or you need to provide more for yourself.

Given my time again, I wouldn't have joined a pension scheme.

A head in sand approach is not a good idea. Not joining a defined benefit scheme is just a crazy option. No alternative would come close to providing the benefits at such a low cost.

redbuzzard

pimento wrote: »

I thought it was but it was a long time ago.




Ironically, I'm in another final salary scheme at the moment. As I joined it quite late on (I was 37) I doubt it will pay out enough to keep me in the manner to which I would like to become accustomed but will probably pay out too much to qualify me for any means tested benefits.

Given my time again, I wouldn't have joined a pension scheme.

I fear your glass is half empty, Pimento. Cheer up:)

20 years+ in DB could give you a very good basis for retirement. My best pension, 20% of my last salary, came out of 12 years in a DB scheme before it closed. I won't draw it for another 5 years when revaluation should see it at £20,000, with some inflation protection and a spouse pension. Better than trying to amass £800k in a money pot for the same from an annuity, and far more certain.

pimento

My pension contributions are £225 a month. For that I could have a stonking holiday every year.

dunstonh

pimento wrote: »

My pension contributions are £225 a month. For that I could have a stonking holiday every year.

And to match the retirement benefits if you wanted to arrange equivalent privately would probably cost you around £1800pm

atush

225 on a holiday would not even cover my bar bill. Some stonking holiday lol

atush

pimento wrote: »

Ironically, I'm in another final salary scheme at the moment. As I joined it quite late on (I was 37) I doubt it will pay out enough to keep me in the manner to which I would like to become accustomed but will probably pay out too much to qualify me for any means tested benefits.

Given my time again, I wouldn't have joined a pension scheme.

You sound quite mad really.

I wouldn't give up the chance at a DB pension, and I would join any pension an employer offered, as long as there was free money attached.

It sounds to me, your ostrich approach to life won't see any easy retirement, more like working til you drop.

xylophone

225 on a holiday would not even cover my bar bill. Some stonking holiday lol

Doesn't he mean £225 x 12? £2700 could buy a relaxing break....;)

pimento

atush wrote: »

225 on a holiday would not even cover my bar bill. Some stonking holiday lol

That's £225 a month.

And I don't drink.

pimento

atush wrote: »

You sound quite mad really.

I wouldn't give up the chance at a DB pension, and I would join any pension an employer offered, as long as there was free money attached.

It sounds to me, your ostrich approach to life won't see any easy retirement, more like working til you drop.

I'll have a short retirement anyway due to my health problems so I do think I'd have been better off to have had the use of my money now rather than later.

Also, I really don't trust that the rules won't be changed. My employer is making noises like they want to change the scheme into a money purchase scheme.

quotememiserable

Despite filling in a nomination form it is up to the trustees whether they pay out or not.

dunstonh wrote: »

That is not correct. The scheme rules will be applied. It will pay out in accordance of those rules. The trustees have a right to overrule nominations of beneficiary that are viewed as being out-of-date or malicious.

Quite right. I'm a trustee for a major scheme, and we are there to ensure the scheme rules are correctly applied. Mostly, this is straightforward, but can sometimes be very tricky. Where no spouse is left, we will pay the lump sum to a dependant. Some people come forward claiming this but are unable to present any evidence that they were dependant. Once, the best the claimant could come up with was a tesco club card in joint names. Another time we had a spouse claiming and the children disputed that she was a spouse. That one took some investigating.