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Raising the pension age in order to pay for pensions
Comments
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Loughton_Monkey wrote: »Youngsters can say this all they like. You can say it on their behalf. But that doesn't make it true.
About the only thing I sympathise with is the student debt, but that is a small 'delayed' problem to be dealt with only when 'good' earnings follow. In the meantime, they are in cash terms no worse off than anyone else.
If you were to say young people choose to contend with other priorities when they are young then I would agree. I see a lot of it first hand. Like a mid-20's lad with a good job, miniscule pension contributions, no pay freeze, but about £500 in debt. But buys a new £350 laptop despite his existing one being perfectly OK. Another mid 20-s lass. Again very good job. Company BMW. Proud she is 'not spending' all her income. But doggedly refuses to join the company pension scheme at 7% employee, 14% employer contribution!!!!! After about 5 years of this, I learn that she has finally joined now she is higher rate tax!
These are just real, but random things I see personally [not my kids, fortunately because I don't have any.] But this type of thing is just a 'serial' and continual conglomeration of extremely poor life choices [not through lack of brains].
This is later-life 'poverty' in the making, before my very eyes. Why, oh why, oh why am I supposed to have a milligram of sympathy? It defies all logic to me.
People will always make poor choices in life the higher level of income just makes the range of choices much larger and the impact more noticeable.
I am merely pointing out that the costs to many youngsters will be higher than in the past in their early stages delaying their ability to contribute meaningfully to a pension. The fact that employer pension provision isn't as good as in the past, (e.g.DB schemes) will exacerbate the final outcome. The fact that there are fewer well paid jobs outside the ever increasingly expensive mortgage zone of the SE further limits ability.
I don't disagree that pension provision and additional savings are entirely sensible if you are still able to live your life in the here and now.
Some people will always mange there affairs well others will not, cannot regardless of income. I don't have sympathy for them that is just a fact of life."If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....
"big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham0 -
Thrugelmir wrote: »Most people can only dream of a portfolio of 6/8 properties with only a 20% mortgage.
The one thing most people lack is capital. Once you've got capital which for most people can only be obtained from working for years or an inheritance.
That is where planning and VERY hard work comes in...getting the capital and the assets to 'Plan' retirement.
Instead of passing away every penny you have on booze / flashy goods and nights out.
I'm on saying don't enjoy you're working life, but you have balance the two out - youth and old age.
P'S. If you are just going have 80/90% mortgage on a BTL, tten what is the point.0 -
Loughton_Monkey wrote: »I tend to sit back and look at all my options....
Personally I would reject BTL for the main reason that the average yieds quoted, over long periods (5%/7%) do not compare favourably with pension/S&S ISA investments (6%/8%). Pensions have tax relief to boot!
Other things I don't like about BTL (for retirement savings) include:
1. Unlike traditional investing, BTL comes with "hard work" and physical hassle from time to time.
2. Approaching retirement, a landlord would find it hard to "tone down" the risk of a 6/8 house portfolio. Indeed a very risky, hard to sell, hard to rent scenario could come just at the wrong time.
3. Planning cash flow (once retired) is a nightmare compared with the 'smooth' results you can get from a range of pensions and other funds.
4. Having all your retirement capital in assets (Cash, Houses, etc.) cannot underwrite for longevity. Pensions are a good hedge against living a long time.
5. Tax planning - particularly CGT - would be a nightmare.
So all in all, I would use a BTL route (over a more tradional pension/investment fund route) only if it gave significantly extra long term growth. I doesn't. So I don't.
I don't disagree with your points, but for me I see them as retirement for me and inheritance for the kids.
I also expect the kids to help with the day to day running when I can't.
as for the CGT, well planned - it can be limited by gifting and TAX planning and so forth. But TAX is part of life, you can't avoid it because of a such a small insignificant matter like 'Your Death'...:)
Each to their own, everyone needs to do what they feel right for them.
The important thing is THEY NEED TO DO SOMETHING.0 -
how exactly does 'compulsory' contributions differ from taxation?
one significant difference, one assumes is that the richer people in employment will get a higher pension that the poor?
Australia uses such a system. I know its controversial (even there).Few people are capable of expressing with equanimity opinions which differ from the prejudices of their social environment. Most people are incapable of forming such opinions.0 -
The solution has to be to make pension contributions compulsory to a minimum level and incentivised beyond that. But this will not solve the problem of those in poorly paid jobs where they cannot afford decent contributions and its commercially uneconomic to have such a small pension pot.I wasn't really questioning how controversial it is, but rather how it differs significantly from taxation.
Why not call it something snappy like National Insurance.;)
We already tried that wheeze.
How about National Insurance 2?"If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....
"big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham0 -
grizzly1911 wrote: »Why not call it something snappy like National Insurance.;)
We already tried that wheeze.
How about National Insurance 2?
NO NO
National insurance - The RETURN of the TAX
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I wasn't really questioning how controversial it is, but rather how it differs significantly from taxation.
As far as I can see, it differs significantly from taxation in being 'funded'. A bit like our new "Nest" scheme except it only applies over $X a month.
As such, it therefore doesn't directly affect the taxpayer other than they can expect, over time, that they can reduce the state pension (except for low earners) and will cost them significantly less in 'top-up benefits' for those who couldn't be bothered to contribute to their own pension scheme.0 -
Loughton_Monkey wrote: »As far as I can see, it differs significantly from taxation in being 'funded'. A bit like our new "Nest" scheme except it only applies over $X a month.
As such, it therefore doesn't directly affect the taxpayer other than they can expect, over time, that they can reduce the state pension (except for low earners) and will cost them significantly less in 'top-up benefits' for those who couldn't be bothered to contribute to their own pension scheme.
Yes, so it would be a tax that is given to private pension funds to 'look' after:
so in the end it all depends upon what the benefits of funded schemes are :0 -
Yes, so it would be a tax that is given to private pension funds to 'look' after:
so in the end it all depends upon what the benefits of funded schemes are :
Sadly that does not inspire one iota of confidence. A nice earned for the intertmediaries though. We could no doubt roll them into annuities at the end of the cycle cream a little more off the top for good measure.
Said intermediaries could then lend the money to the government and charge interest on said loans to be paid for by the taxpayer.
Add on a dividend of say 5% of all costs to be paid to a select few.
The taxpayer could also fund the ultimate back stop that will always be required.
:beer:"If you act like an illiterate man, your learning will never stop... Being uneducated, you have no fear of the future.".....
"big business is parasitic, like a mosquito, whereas I prefer the lighter touch, like that of a butterfly. "A butterfly can suck honey from the flower without damaging it," "Arunachalam Muruganantham0
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