Nice People Thread No. 15, a Cyber Summer

oldandhappy

well taller than Gerrys parents..they where under 5foot but Gerry is 5ft 10ins likewise his younger brother who lives local to here also.oldest sister arriving tomorrow pm for a week:eek:but we are strong people:)and it is only a weeeeeeeeeeeeekkkkkkkk

michaels

Only 1 German for dinner tonight, other two have decided after 48 hours in the UK that the one thing they need to do is go to the football at Milwall...!!!!!!?!

vivatifosi

Generali wrote: »

I think there's a distrust of the financial services system, rightly IMHO, that manifests itself in things like BTL and also in people taking their money out of annuities.

Also for many, an annuity is basically worthless as they'll earn far more on benefits. If I had spent a long time in a low paid job and was retiring I'd consider taking the cash and doing the house up and buying a couple of new cars, things that will last me 10-15 years and give a real uplift in lifestyle. After all, the Government will make good on a large chunk of my income so why not?

Cradle to grave innit.

The issue I have is that if you take over 25% as upfront cash, you pay tax on it. I just can't get my head round that as in most instances that's a really poor financial decision.

Furthermore, people are absolutely blind to the changes in the state pension. All sold as benign and fabulous, but in reality has a scorpion sized sting in the tail. The problem is that when they are eighty and living in a rented room in a shared house, it will all be too late to change.

zagubov

vivatifosi wrote: »

The issue I have is that if you take over 25% as upfront cash, you pay tax on it. I just can't get my head round that as in most instances that's a really poor financial decision.

Furthermore, people are absolutely blind to the changes in the state pension. All sold as benign and fabulous, but in reality has a scorpion sized sting in the tail. The problem is that when they are eighty and living in a rented room in a shared house, it will all be too late to change.

I'm clearly not up-to-date with this. What are the main problems? (if it's not easy to summarise are there any good summaries out there you can link to?)

Generali

vivatifosi wrote: »

The issue I have is that if you take over 25% as upfront cash, you pay tax on it. I just can't get my head round that as in most instances that's a really poor financial decision.

Furthermore, people are absolutely blind to the changes in the state pension. All sold as benign and fabulous, but in reality has a scorpion sized sting in the tail. The problem is that when they are eighty and living in a rented room in a shared house, it will all be too late to change.

My vague squizz showed that the changes are really good for me. I am very much a passive recipient of whatever the UK Government gives me now and the changes to the state pension designed to help women are going to be a huge benefit to me, especially if I go back and do a year or two right before I retire.

vivatifosi

You should do well Gen, there are quite good reciprocal arrangements in place between the UK and Aus. My parents get a small Aussie pension that the UK govt kindly pays alongside their own.

Zag, there are two main issues with the new pension. The first is that most people won't get what they expect to get as the way it is calculated is v much in the small print. For example, all the years that I contracted out of SERPS won't count for me. This is not a problem for me... I've paid into pensions since I was 21 so will do ok, but not everyone is in the same boat.

The second is that although the new pension is more generous, it isn't really designed to have layers of top ups. By getting people to opt out rather than in to workplace pensions, the govt is sending a very strong signal that it expects everyone to do their bit. Therefore I can see a situation in the future where if you don't save and you cash in the little you have done on a holiday, you'll end up on not very much. Plus potentially the state may just want to rent you a room, rather than paying for a whole flat. We are not there yet, but I can see it happening.

vivatifosi

That's annoying... I wrote a really long post about the new system and in going off to get a couple of links the system lost it. Don't have time to repost as need to go to sleep, but here's some background. I will come back to update this post rather than losing this too, so this will get longer.

Impact of changing to new pension:
http://www.telegraph.co.uk/finance/personalfinance/pensions/11608210/The-new-flat-rate-pension-where-everybody-gets-different-amounts.html

New rules for expats:

http://www.telegraph.co.uk/finance/personalfinance/expat-money/11486682/Expats-have-nine-months-to-clock-in-or-lose-their-state-pension.html

Auto enrolment winners and losers:
http://www.thisismoney.co.uk/money/pensions/article-3246400/Who-s-NOT-benefiting-pension-auto-enrolment-reforms.html

This for me is a big deal. If people DON'T save when they can, or take their money out and blow it on a round the world cruise, I can well see the government saying "tough, you had your chance". They are designing a system designed to be flat rate and without layers of top ups.

Still, if you get to grips with all of that, you then get a curved ball:http://citywire.co.uk/new-model-adviser/news/altmann-lifetime-isa-is-not-a-pension/a901954

These changes are momentous. I've been a pension trustee for sixteen years and my head is spinning trying to stay on top of this. Plus stuff that only trustees and their sponsors will be worrying about... such as vat treatment on fees and what will happen to Jersey based investment vehicles.

And then my post appears above this one... go figure.

Generali

Yeah, these reforms are a right result for me I think if I do a year or two in the UK at the end of my career in order to refresh when I left the UK from a pension POV
A $10,000-20,000 a year bonus money on top of my super would be a right result.

Which Labour leader are you?

http://www.greatbritishpolitics.co.uk/magazine/304-which-labour-leader-are-you

michaels

I was a bit peed off to discover that had I contracted out of serps/s2p for 10 years I could have built up an additional pension and then in the next ten years still pay enough NI to get a full state pension. Instead by the end of this year I will have the full state pension entitlement and all the NI I pay thereafter will not add 1 penny to my pension. At the time I made the decision contracting out was presented as the more risky option and this changing of the rules after the event seems unfair.

michaels

Generali wrote: »

Yeah, these reforms are a right result for me I think if I do a year or two in the UK at the end of my career in order to refresh when I left the UK from a pension POV
A $10,000-20,000 a year bonus money on top of my super would be a right result.

Which Labour leader are you?

http://www.greatbritishpolitics.co.uk/magazine/304-which-labour-leader-are-you

Is it still the case that if you take your state pension abroad including in the eu you don't get any annual increases?