My view on Pensions

Rachel_Pierson

mgdavid wrote: »

So, my question to you is, what are you going to do when your pension isn't enough to support your retuirement?

Do keep up, dear...

Rachel_Pierson wrote: »

I can guarantee that every time I discuss pensions with a group, someone will ask that question. My answer is always the same - "the same as you, but I won't be propping up a Ponzi scheme for 40 years first". The fact, as I see it, is this: we're all going to have a crap retirement, unless we invest wisely ourselves outside of pension provision. Name me one person that wasn't an MP that can live on their pension alone today? Most people rely on a combination of other investments to supplement what amounts to a pretty meagre sum from their pension.

So, my question to you is, what are you going to do when your pension isn't enough to support your retuirement? Same as me probably, except your investments may be worth less because you've had less funds available to invest whilst you were working.

Triumph13

Rachel_Pierson wrote: »

The sort of DB schemes some people have mentioned in this thread simply aren't available to future pensioners now. (And when one was available to me about 10 years ago, it was accompanied by a crap salary; that seemed to be the trade off.) DB pensioners are however funded by pension providers encouraging people to sign up for far less beneficial schemes today to pay for yesterday's promises that they now realise it'll be challenging for them to keep.

Do you actually have any understanding at all of how the different types of pension work? How on earth can 'pension providers' encouraging people to join DC schemes prop up old DB schemes?
The DB schemes are a liability of the sponsoring employer. If the scheme is underfunded the employer has to make up the shortfall. If the employer goes bankrupt trying to do so then the PPF has to step in.
DC schemes are ring-fenced pots of investments belonging ultimately to each individual investor. There is no possible way the company can take money from those pots to subsidise its DB liabilities.
If a company was worried about its pension liabilities then it would love to be allowed to encourage people NOT to join the DC scheme as it then wouldn't have to make any employer contributions and could use the money saved to help fill any DB underfunding.
Please either listen to what people who know a hundred times more about this than you do are trying to explain to you, or go away and learn something about how pensions actually work.

dunstonh

What do you do in real life when people disagree with you? Tell them their pants are on fire? Stick your fingers in your ears and go "la la la" until they go away?

Hold on. People here have given you facts and information to correct your misconceptions and misunderstanding. It is you that seems to be ignoring that and going la la la.

I can see why people who've paid into pension schemes for years have a vested interest in encouraging others to join. The people at the top of any pyramid scheme are always its most ardent proponents. Because if new mugs don't join, the scheme will collapse, after those at the top have paid in for years but before they get any benefit from doing so.

That is absolutely ridiculous as that is not how money purchase pensions work.

As for the PPF that some people have mentioned, I don't see that stepping in to help members of the BHS scheme who are not yet drawing down in obtaining their "free money", so they can transfer what they're due to another more stable scheme. Who do you think will be paying for the loss of interest those pension savers will experience in the mean time? (Clue: it won't by the taxpayer / PPF / or indeed Philip Green. It'll be the poor sods whose pension savings have been squandered on bonuses for Phil and his pals.)

The BHS pension is currently in the assessment stage with the PPF. The PPF has a £4.1bn surplus (As at 31 March 2016). BHS had a £571m deficit.

But some, like me, will decide long term that they're not interested in a pension, and will keep jumping through hoops to opt out, resenting it more and more every time we have to.

As a taxpayer, I thank you for your stupidity in not accepting tax relief or the employer contribution. Both of which aid the taxpayer and only you suffer.

molerat

With my last employer for every 68p lost from my take home £4 went into the DC pot, please show me how that was not a good deal.

Admittedly pensions may not the best option for some. Rock stars and premier league footballers (although pre 2006 joiners had a very good retirement age) will have some very tax efficient schemes open to them outside of pensions. The poorest could possibly be better off without a pension under the current perverse benefits system (which may be subject to change in the future - do you feel lucky ?). But for the majority every day Joe pensions are difficult to beat especially if all the contributions are not coming out of your pocket.

I have not worked for 8 years with another 3 before my SP , as one of those everyday joes I could never have afforded to "invest" enough privately to do that. Pensions are just part of a greater retirement strategy.

HappyHarry

Rachel_Pierson wrote: »

Dream on. Never mind, maybe some day they'll make a special forum just for people that agree with you.

They have. It's this one.

archie17

I find this post very sad.
A lot of my friends are now retired, We generally in reasonable occupation and were able to use a pension of one sort or another to make sure we are relatively well provided for.
There is a chance that this could all go pear shaped; but forums like this have helped me make what I consider to be reasonable decisions.
I have found this forum very useful it seems such a shame that people have to spend so much time trying to convince others of their misconception

Lokolo

archie17 wrote: »

I find this post very sad.
A lot of my friends are now retired, We generally in reasonable occupation and were able to use a pension of one sort or another to make sure we are relatively well provided for.
There is a chance that this could all go pear shaped; but forums like this have helped me make what I consider to be reasonable decisions.
I have found this forum very useful it seems such a shame that people have to spend so much time trying to convince others of their misconception

If it wasn't for this forum (and especially dunstonh and oldernotwiser), I wouldn't be here at 28 knowing full well what my plan for retirement was. I am sure I am not the only one that has benefited from contributors of this forum.

The one thing that does annoy me is Martin gets a lot of credit, whereas it is actually the members and contributors that make this forum what it is, and he never credits these people.

mgdavid

Rachel_Pierson wrote: »

............
The sort of DB schemes some people have mentioned in this thread simply aren't available to future pensioners now. .........

more utter tosh.
My son (age 37) is in one (large US chemical company)
Several FTSE250 companies still offer them.
Every shopworker in Waitrose with 3 years service can have one.
Most of the public sector still provides them.

'none so blind as those who will not see'

mgdavid

Rachel_Pierson wrote: »

Do keep up, dear...

Instead of being patronising how about answering the question, dear?

mgdavid

Seems that the OP has history on this subject, here's a comment made on MoneyMarketing back in 2013 (the subject matter was consultancy charging for auto-enrolment but that's largely irrelevant):

"Rachel Pierson 29th May 2013 at 10:16 pm It’s bad enough that these scumbags have persuaded their cohorts in government to allow them to inertia sell pensions that nobody wants to buy. Now they want to charge victims for the privilege of being signed up to schemes we have no interest in? As for those “advisors” that small companies may not be able to afford. Don’t make me laugh. These con men would willingly pay for the chance to inflict their “advice” on employees. I personally give them short shrift. I’m even less interested in listening to their self-serving drivel about “giving up free money” than I am in taking out their shoddy product in the first place. Tell the victims of the many pension schemes that have collapsed about all that “free money” and see the reaction you get. These people are parasites. Nothing more, nothing less. Their products are so attractive and so much of a no-brainer that they actually have to persuade government to inflict them on workers rather than being able to sell them on their actual merits. And if even if you say “no” in the clearest possible language, they have made a deal with politicians that allows them to sign you up without permission again every two years. Think about that. Who has to market their product that way? If these scheme were actually of any value whatsoever they wouldn’t need to force them on their victims. There’s a reason nobody is buying what you are selling, pension scheme organisers: your products are simply not worth the paper they are written on."


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