Nice People Thread No. 15, a Cyber Summer

michaels

Generali wrote: »

The Government doesn't have to include unfunded pensions in the National Debt for this very reason. I vaguely recall banging on about this incessantly for many years.

I always wonder if there is an inbuilt bias for the govt to employ employees rather than contractors as when doing the accounts they basically ignore the employee pensions accruing? (Hence the cost issue problem of the NHS filling empty posts via agency staff)

In my normal child like way it is not the default that I object to but the unfairness that some got lucky by contracting out without any information to inform that decision. I was advised that contracting out was unlikely to bring higher returns than SERPS on average and was more risky in that returns could be volatile where as with SERPS it was a defined benefit.

Generali

michaels wrote: »

I always wonder if there is an inbuilt bias for the govt to employ employees rather than contractors as when doing the accounts they basically ignore the employee pensions accruing? (Hence the cost issue problem of the NHS filling empty posts via agency staff)

Quite possibly.

Unfunded liabilities remain almost completely ignored by all voters and commentators.

michaels wrote: »

In my normal child like way it is not the default that I object to but the unfairness that some got lucky by contracting out without any information to inform that decision. I was advised that contracting out was unlikely to bring higher returns than SERPS on average and was more risky in that returns could be volatile where as with SERPS it was a defined benefit.

I stay happy by worrying more about what happens to me than comparing myself to others.

Your choices were pretty obviously based on a massive political risk: that pension laws would remain unchanged for many decades despite them having being changed many times previously and also despite the current laws clearly leading towards the ruination of the UK's finances.

To be clear, I am very sympathetic to your plight. I really am. TBH I think this is a part of a broader attack on the rentier classes. Look at what's happening to BTL at the same time and to holders of offshore funds that are used to dodge taxes. This stuff isn't a coincidence IMHO. I think there'll be more to come too.

Real business assets are the way forward.

michaels

Generali wrote: »

Real business assets are the way forward.

This is the issue - should I continue with my own pension contributions that can obviously easily be 'confiscated' or use ISAs that in theory might be less easy for the govt to get their hands on (but still liable to be impacted by rule changes) or hide the money under the mattress? If the govt has robbed you once what is stopping them from doing so again? Perhaps the best approach is maximizing your investment in your PPR and trying to influence the govt to maximise inward migration in a sort of 'let's hope the ponzi scheme keeps going until I cash in' approach....

Generali

michaels wrote: »

This is the issue - should I continue with my own pension contributions that can obviously easily be 'confiscated' or use ISAs that in theory might be less easy for the govt to get their hands on (but still liable to be impacted by rule changes) or hide the money under the mattress? If the govt has robbed you once what is stopping them from doing so again? Perhaps the best approach is maximizing your investment in your PPR and trying to influence the govt to maximise inward migration in a sort of 'let's hope the ponzi scheme keeps going until I cash in' approach....

My view is that the rentier-like asset is the way forward: something that looks like a business asset but that returns a simple income. Something that looks more like a business and less like a passive income.

For example, buying a dozen cement mixers to rent to local builders or a dozen bouncy castles to rent for birthday parties. TBH it's not that different from BTL and probably less effort and less regulated but it makes you into a business and so not to be taxed out of business and less a hated rentier.

Let's face it, when was the last time you heard someone say how great they thought their landlord or bank manager was? Loads of people love the people they do business with though.

Just a thought.

silvercar

PN wrote:

Nothing's changed with any pension changes.....

Before: I didn't understand them whatsoever. I have no private pension.
Now: I don't understand them whatsoever. I have no private pension.

No change!

Similar, but worse. I don't know if I have a private pension. I don't understand any of it, leave it to an IFA to sort out.

Gen wrote:

My view is that the rentier-like asset is the way forward: something that looks like a business asset but that returns a simple income. Something that looks more like a business and less like a passive income.

My IFA said something like that, I think. If I understood correctly (possibly not) there is a limit to what you can or should put in a pension.

vivatifosi

silvercar wrote: »

Similar, but worse. I don't know if I have a private pension. I don't understand any of it, leave it to an IFA to sort out.

My IFA said something like that, I think. If I understood correctly (possibly not) there is a limit to what you can or should put in a pension.

On the first point, write down everyone you worked for after the age of 21. IIRC, it used to be difficult to get a workplace pension below 21. Also, back then, you had to have worked for them, often for two years. This is a good place to start.... anyone you worked for after 21 for two or more years. Then contact the Pension Tracing service to get back in touch with your employer:
https://www.gov.uk/find-pension-contact-details

Pension funds are having to work much harder now than they did in the past. Our fund writes to all of its deferred members every year, as do the two other deferred schemes I am a member of. You should be getting these. If you have moved away or married, they may be trying to track you down. We use a tracing service and have tracked all but two, but not all schemes are as on top of this area.

On the second point, this is called the "Lifetime Allowance" and is being reduced from £1.25m to £1m. This has a potential to catch out some high earners, but there are ways of planning for a better outcome. Here's a bit more info:
http://www.pensionsadvisoryservice.org.uk/about-pensions/saving-into-a-pension/pensions-and-tax/the-limetime-allowance

silvercar

vivatifosi wrote: »

On the first point, write down everyone you worked for after the age of 21. IIRC, it used to be difficult to get a workplace pension below 21. Also, back then, you had to have worked for them, often for two years. This is a good place to start.... anyone you worked for after 21 for two or more years. Then contact the Pension Tracing service to get back in touch with your employer:
https://www.gov.uk/find-pension-contact-details

Pension funds are having to work much harder now than they did in the past. Our fund writes to all of its deferred members every year, as do the two other deferred schemes I am a member of. You should be getting these. If you have moved away or married, they may be trying to track you down. We use a tracing service and have tracked all but two, but not all schemes are as on top of this area.

On the second point, this is called the "Lifetime Allowance" and is being reduced from £1.25m to £1m. This has a potential to catch out some high earners, but there are ways of planning for a better outcome. Here's a bit more info:
http://www.pensionsadvisoryservice.org.uk/about-pensions/saving-into-a-pension/pensions-and-tax/the-limetime-allowance

Thanks viva.

I should point out that I have the huge advantage of having an OH that understands all this.

CKhalvashi

GDB2222 wrote: »

I'm flying Lufthansa tomorrow. They list the things you can't carry on board in pictorial form. Here's one of their pictures:



Thank goodness they told us!

Hahahahahaha

We have an anti-Lufthansa (or any affiliated companies) policy in my house, or I'd probably have picked up on that sooner

chewmylegoff

michaels wrote: »

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.

Don't worry, they'll change the rules again before you retire!

CKhalvashi

chewmylegoff wrote: »

Don't worry, they'll change the rules again before you retire!

And probably 3-4 times more before I do!

ETA: The rules now are nothing like I signed up for, and as I was saying the other week, if I retrospectively changing a contract then I'm sure I'd have problems for it.