Channel 4 - how to blow your pension

atush

hcb42 wrote: »

I guess those that do bother to build a pension are less likely to blow it on a lamborghini - and if they do, it only puts them back in the position of those who didnt save for the future.

Personally I hate the thought of having an annuity, I would rather have the cash out (and I know I would be mega sensible ..!)

How can you say you are 'mega sensible' when you'd lose 20-40% of the non tax free portion (ie 75% of your pot) to tax?

atush

DancingBadger wrote: »

If that programme saves some people from investing in Far East car parking spaces or US forests it will have served some purpose.

We can but hope. But that's ok, in 2 years time there'll be another with those who didn't pay any attention? Talking about losing all their dosh?

Doens't matter how often we warn people, someone was just on here today saying they were going to invest in student pods?

FLAPJACK

veryintrigued wrote: »

I thought the whole programme was incredible. The highlight being the incisive words from the 17 year old. How on earth did that make the final cut?

What a waste of 30mins.

Indeed it was a wasted opportunity. A very lightweight affair really....
All I came away with was the fact (it seems) that "blowing" the money is the only answer if you have a pot of 30k or under.

I take it these people who spend the money must have another line of pension income (apart from the SP) otherwise things in the future will be tight.

The programme didn't show any alternative that could be done with the money apart from spend it.

I suppose the people who spent their only pension pot can join the ex savers who have spent their capital on living expenses (instead of living somewhat on the interest that would have been generated) in the benefits queue when neither have capital left.

atush

Plus they didn't mention losing huge chunks of it to tax, nor that annuities CAN be the best option for many.

And there were so many mistakes on the facts, it was plain scary. because people will say "that nice MB from the telly said this was true" when in fact he was bolstering his own BBC pension?

FLAPJACK

atush wrote: »

Plus they didn't mention losing huge chunks of it to tax, nor that annuities CAN be the best option for many.

And there were so many mistakes on the facts, it was plain scary. because people will say "that nice MB from the telly said this was true" when in fact he was bolstering his own BBC pension?

Indeed the more you think about it what was it about??

It's odd to think to think that MB (a trusted elder...in the over 55's eyes....i.e pension cashing in catchment) a seasoned journo didn't see though this programme.

I think he retired from the BBC a while ago (this was a C4 production) so was interviewing the unfortunates whist drawing a nice DB BBC pension thereby not having to worry he will be in the same situation.

Bit like the Parkinson ad ....that will be the most expensive Parker pen you'll buy.

See a lot of the 80's tv people popping up now on shows... bolstering their pensions too no doubt.....the trouble is that seeing them makes me realise how much older I must look.:o

hyubh

Some people do have odd expectations... as a gentle introduction to the issues involved in drawing a private pension I thought the programme was pretty good. It wasn't 'about' something in the sense of having an agenda to push - instead, it gave various persuasions an airing. Perhaps the turn of the pro-annuity position was a bit rushed at the end (was John Ralfe not available? Most other pension personalities on Twitter appeared...), but it was still there.

atush

It was about how to blow your pension. And was full of factual mistakes.

cepheus

I can see every financial charlatan using the new flexible pension rules as another opportunity for mis-selling. Neither can we expect pension providers to provide advice in their policy holders best interest. The programme made both of those points reasonably clear. Independent advice is fine for large amounts but hardly cost effective for smaller pots.

Why can't the government send out compulsory general advice on the options available on retirement. i.e. Consider drawing down the pension instead of buying an annuity and if you do buy an annuity shop around. Also make it compulsory for regulated companies to offer competing annuities as people reach retirement so they are faced with genuine competitive market based choices.

I think giving everybody the choice to blow their pension, irrespective of other means of support other than the state is a recipe for disaster, and the taxpayer may need to bail people out again. However, Osborne's pension change will woo older, richer, Tory voters. That's all what really matters isn't it? Shove the problems into the future for another government to sort out.

bristol_pilot

The media seem to be bending over backwards to find problems with the new rules - and failing miserably in my opinion. This programme was such an example. What's wrong with withdrawing most of a DC fund to live a little when you have either a life-limiting condition or sufficient DB pension to live on? The people featured in the programme were mostly making perfectly sensible decisions - the programme makers went looking for Lamborghini-buyers and failed to find them.

In another example this week (BBC), we see that someone retiring with a pension pot of £29k will run out of money after 10 years - really??! you don't say! If that's all you've got to show after 40 years of work, well you have messed up, the new rules have nothing to do with it! The average 'pot' is said to be £30k - however many people reitring now will either have DB provision as well or will have several 'pots'.

dunstonh

I can see every financial charlatan using the new flexible pension rules as another opportunity for mis-selling.

Most of the advisers I know are planning to distance themselves from many of the new "freedoms" as they are scared of future liability.

Neither can we expect pension providers to provide advice in their policy holders best interest.

Correct. Providers are not there to give advice and wont give advice.

Why can't the government send out compulsory general advice on the options available on retirement.

Advice has a specific meaning. It carries liability. Are you saying that taxpayers should take on that liability?

Also make it compulsory for regulated companies to offer competing annuities as people reach retirement so they are faced with genuine competitive market based choices.

You mean exactly how IFAs do?

I think giving everybody the choice to blow their pension, irrespective of other means of support other than the state is a recipe for disaster, and the taxpayer may need to bail people out again. However, Osborne's pension change will woo older, richer, Tory voters. That's all what really matters isn't it? Shove the problems into the future for another government to sort out.

So, why should someone that has £100k in ISAs be trusted to control their spending whilst people with £100k in pensions cannot?