Sipp outlook

MarcoM

I admit I don't know much about sipp and I need to educate myself.
However with ever increading retirement age is it possible that one day a government may turn around and say that sipp retirement age will not be 55 anymore but 62?

hypothetically a jeremy corbyn gets in, squanders whatever little the treasury has for ten years and there is no money left and the mc donnell money tree dies, is it plausible that a government could then put a stop to paying sipp proceeds?

i'd like to know what the likes of dunstoh think about the above, i am interested in possibly investing into a sipp what is a large amount but I do worry about governments taking the proverbial when it comes down to paying pensions.

dunstonh

However with ever increading retirement age is it possible that one day a government may turn around and say that sipp retirement age will not be 55 anymore but 62?

yes it is.

hypothetically a jeremy corbyn gets in, squanders whatever little the treasury has for ten years and there is no money left and the mc donnell money tree dies, is it plausible that a government could then put a stop to paying sipp proceeds?

The SIPP holds investments of your choosing. To require a haircut wouldnt just be on pensions but would be on everything. it would be the end of the UK as we are so reliant on financial services that such a haircut would damage the UK beyond repair.

So, theoretically possible but in the third world countries it has happened, it tends to be on savings first.

i'd like to know what the likes of dunstoh think about the above, i am interested in possibly investing into a sipp what is a large amount but I do worry about governments taking the proverbial when it comes down to paying pensions.

To be honest, if the country sinks that low, you wont really be caring that much about your pension. And the pension wont be the first thing hit.

Lungboy

SIPP age is increasing to 57 in 2028 isn't it?

Reaper

I believe the plan is for the SIPP retirement age to always be 10 years before whatever the state retirement age is set to.

dunstonh

Lungboy wrote: »

SIPP age is increasing to 57 in 2028 isn't it?

It was a proposal in the consultation of the pension freedoms introduced in 2015. However, it never made it into the final Act. However, it has not been denounced yet either. So, it remains an intention but is not yet in law and may not happen. Plan for the assumption it is.

Plus, its not specific to SIPP. There are actually barely any laws specific to SIPP. It is pensions. Stakeholder, personal, SIPP and workplace.

LHW99

a government could then put a stop to paying sipp proceeds

Strictly its not the Government that pays SIPP proceeds. That is done by whoever runs the SIPP (or other pension).
What the government does is set the limits on when you can request payment from your SIPP, how much you can put into it, and when you are / are not able to get tax relief on contributions.

BananaRepublic

The real problem is that the government can do almost whatever it wants. They have made pensions much more favourable but they could easily back track, especially if it was a Labour lot in power.

MarcoM

i hope i have not misinterpreted dunston's response but he seemed to imply that a government would find it very difficult on renegading paying sipps out as this sort of approach would kill off the uk's position in the financial world.

personally i would not trust that nasty little man called mc donnell not to pull some sort of trick on private pensions once he has bled the money tree to death. he would rather kill off anyone who has made some personal financial provision for themselves. He would rather not go after the big tax evaders, very much like the tories, the same ones he seems to hate so much....

TheTracker

It is the very fact that the government of the day and the future day might have to resort to such measures that means they need to offer certain immediate or future perks to have you build your own pension. You take the risk of government or societal collapse, and they promise you tax breaks. With one of the risks that any such collapse can remove those tax breaks. That is the Faustian pact we make. With all the so called free money nonsense you hear from pension advocates, it is actually at a price, not free. Of course you can skip building a pension, pay tax now, and be a touch safer. You decide if your irrational fear of economic collapse if a new government forms is worth forgoing double digit tax breaks.

BananaRepublic

I fear that McDonnell is a good old fashioned class warfare Labourite. Anyone who saves for their future rather than partying would be punished.

Thrugelmir

MarcoM wrote: »

hypothetically a jeremy corbyn gets in, squanders whatever little the treasury has for ten years and there is no money left and the mc donnell money tree dies, is it plausible that a government could then put a stop to paying sipp proceeds?

More likely to tax the proceeds rather than stop. The Treasury currently borrows some £1 billion a week. There is no cash in the kitty.