autoenrolment cancels housing and council tax benefit

stu12345_2

the poster that said ur planning to be poor good for you, not if i was 21 and saved heavily for 40 yrs.
im talking about those that start saving in their 50s on min wage, pt time wages etc, im saying no matter how hard they try, eg 3% cont, if thats all they can afford. their £15000 or so the built up would just simply cancel any help.

im waiting for some readers on mse that are indeed on low paid wages and maybe nearing 50 who rent council or housing association or even private that accepts dss, are considering what their small dc fund will do to their entitlements.
were not all 21 on good wages with 40 yr investment plans, auto enrolment should be compulsory under 40s, not for those with say 10 to 15 yrs till 65 on min wage

mgdavid

just for balance I find it very encouraging that we keep seeing new threads started "Almost 21 Years Old, I Want To Start A Pension Now" and similar.

stu12345_2

maybe see a thread that says im 50 on min wage and rent should contribute 3% as thats all i can afford.

http://www.theguardian.com/money/2014/jun/07/confused-pension-state-benefits


this explains the consequences of a private pension and how it affects state benefits, food for thought.

xylophone

Contributing to a pension reduces take home pay and may mean an increase in means tested benefits for some...

https://www.gov.uk/workplace-pensions/what-you-your-employer-and-the-government-pay

"Joining a workplace pension scheme means that your take-home income will be reduced. But this may:

mean you’re entitled to tax credits or an increase in the amount of tax credits you get (although this may not affect your tax credits until the next tax year)
mean you’re entitled to an income-related benefit or an increase in the amount of benefit you get
reduce the amount of student loan repayments you need to make"

stu12345_2

working tax credits will be scrapped when universal credit takes over. my point is when u withdraw ur pension in the 20 or so years as a pensioner, u could lose 1000s in housing or council tax benefit, especially if u take a lump sum.

anyone on jsa wont be paying into a pension and the low paid workers are merely funding the tory governments housing and council tax awards ur rightlfully entitled to.

if u take a weekly private pension that has the same value as any award. a pension of say 80 a week would reduce housing and council tax benefit from say 82 to 16 a week.


is autoenrolment a scam, please read this link.

However, perhaps the biggest problem with auto-enrolment relates to how it interacts with state benefits. At the moment, for every pound of "excess income" someone receives, they lose 65p of housing benefit. For council tax benefit, the reduction is 20p for every pound. "People might increase their private pension income by £1 but find their means-tested benefits go down by over 90p. You can see that the extra amount they gain isn't an awful lot," says Chris Curry, research director at the Pensions Policy Institute.

http://www.theguardian.com/money/2012/jul/13/pensions-automatic-enrolment-pay

the general feeling amongst the comments written in this newspaper is that if ur late middle ages on low income and need state top ups when retired then dont save in pension, use ur current wages to give urself a half decent life till 65.
and it be fairer for those on low incomes with debts or have little disposable income, to not contribute, but have the employer contribute only so u get some money without damaging ur already low income.

again tho if ur a highish earning 21 yr old with few debts, then invest for a long long time.but auto enrolment blanket formula is everyone has years away from retirement, is well paid, has no current debts and owns a house.
how wrong they are to assume that.

greenglide

And in the future, as the benefit entitlements change, the people who expected to "live comfortably" on state pension plus housing benefit and council tax benefit find that these benefits are no longer payable "as of right"?

A lot could change in the future. What happens if housing benefit is linked to local housing costs so that current levels are paid to those in the South East and only half the rate in the rest of the country? Council Tax is reformed and council tax benefit is scrapped? Single person tax allowance cut to £5,000 and all benefits taxable? National Insurance merged into Income Tax and the new combined rate is 30% starting at £4,000 total income? Claimants of any means tested benefits interrogated as to their suitability for the benefit and turned down if they are deemed to have frittered their life away, voted for wrong political party etc.

All things may change.

stu12345_2

council house rents are roughly affordable all over uk from 45 a week in ayrshire scotland to 85 a week in hampshire.
these rents are cheap as the properties have been bought and paid for many yrs ago, any income from them is a bonus to a council.
easily affordable via benefit, i dont expect the gov to pay housing benefit for a pensioner in a private sublet in chelsea at 350 a week.
as for frittering away, how does that plan involve someone on min wage, simply getting by during their working life.

plus what do u say to someone that invested in auto enrolment only to find a stockmarket crash took 50% of their small savings, sorry no housing or council tax benefit for u, u shouldnt have been so unwise to start dabbling in stocks and shares.

as the disclosure says, ur plan may go up and down and u may not get back ur capital. so if someone doesnt auto enrol as they refuse to gamble, do u penalize them.
do you say sorry its a tent for you cos u never landed a good job.
and what about current oaps in council homes, evict them, create 1 million tents in a park.

if the gov wants a garauntee noone claims, they have to up ni contributions so that pension min is 12000, so no need for top ups, but that will put low paid workers into destitute during their working life.

there will be high paid and low paid workers in any prosperous country.
if you cant afford a pension, so be it. thats why we live in a decent country called, uk, and we protect poorer folk
if i was a wealthy worker saving in a pension, id be happy knowing we live in a country that helps each other and be glad to know that some of my tax helped support oaps, especially those in low incomes that never had the ability to invest in a private pernsion

and if the worst ever happens according to you, the best plan for folk that cant afford a pension is to make sure they live with someone when retired, 2 incomes, one household, the same way as it easier to get a mortgage with 2 incomes.

and if any gov decided to scrap benefits for oaps, i think they would be booted out at election, pensioners are the biggest voters and what they think goes and gov know that, why do you think bedroom tax doesnt affect pensioners even tho they are the ones that mostly under occupy.

mgdavid

stu12345 wrote: »

.... my point is when u withdraw ur pension in the 20 or so years as a pensioner, u could lose 1000s in housing or council tax benefit,........

maybe; fortunately this only applies to a minority. Three quarters of pensioners own their own home outright (from gov report).

stu12345_2

they may own them but still pay council tax which can be expensive. think of the future more folk need renting, flexiblity to move for jobs, dont want or cant afford repairs, eg council is best.
and houses are too dear anyway.

and i enquired about right to buy, my council officer put me off the idea, mentioning ongoing upgrades, repairs when retired, and the fact a care home takes it off you.
they said safer to rent from council than rent from a bank.

and in future the rise of folk renting will increase and become pensioners who will have alot of clout in elections, after all the oap house owners of previous generations have died off.

which should encourage gov to build low cost homes to rent as was the case of previous governments, because anyone renting private on a low income that cant afford mortgage or pension needs to get out of private rent and get their name down on waiting list.

get ur name down at 16 and u will be renting council within 5 yrs, and not paying huge sums to private landlords subsidising their future pension.

i know numerous folk in towns within 20 miles of edinburgh that didnt wait 20 yrs for a council/housing association property. i myself, before i lived in cornwall, waited 12 weeks for a property and simply moved to cornwall via a mutual exchange in order to take up a new job.

i agree there may be longer waits for more attractive regions like cornwall, but mutual exchanges are the solution, that allowed me to relocate always in a secure tenancy. thus get ur name down in an region with more housing and then swap to an area with less housing, thats what i did many times.

greenglide

Most "council houses" these days are actually owned by housing associations, not councils.

I can still see a long cold future for you .........................

But hey, not my problem:-)