Sipp outlook

MarcoM

BananaRepublic wrote: »

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

i'd like to know how much he has got stashed away...

MarcoM

TheTracker wrote: »

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.

it is not economic collapse i fear, it is a nasty little man with a grudge who will tax people who have worked hard to earn a nest egg.
i also fear his sidekick, who has never worked a day in his life and earnt a living as a back bencher whilst living in a three million quid home and calling himself a socialist...

AnotherJoe

MarcoM wrote: »

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.

The government isn't paying out SIPP proceeds, but if for some bizzarre reason they decided to stop people taking money out of SIPPs (why do you think they might???) then people would have less money to spend and there would be less income from VAT as they bought fewer items, fewer small business jobs available, eg fewer people employing plumbers, electricians, cleaners etc and this less revenue to the taxman from that segment of the economy.

So it would be wholly counterproductive.

The same reasoning would also apply to raising the age you can take your money out of a SIPP, as well as making fewer jobs available to younger people.

TheTracker

MarcoM wrote: »

it is not economic collapse i fear, it is a nasty little man with a grudge who will tax people who have worked hard to earn a nest egg.
i also fear his sidekick, who has never worked a day in his life and earnt a living as a back bencher whilst living in a three million quid home and calling himself a socialist...

Whatever your fears you can put your money where your mouth is, we do not need to agree or disagree with your fears to say that. Whether it is reds under the bed (pensions seen as not safe), skepticism about market value and rationality (buy gold), fear of cash holding value (buy bitcoin), or societal collapse (buy food and guns), you have options.

I have never seen you or your posts before, but your opinions on labour leadership seem strong enough that it would seem odd to now plump your coin into something you are so skeptical of. The UK and other western democracies have gone through turbulent times, but markets are far more resilient in the long term than the political whims of our leaders. Your choice is yours to make.

Bimbly

Not that I have any particular experience or knowledge to bring to the table, but...

It seems to me that the only changes that could be made are on tax relief on pension contributions. That could take the form of:
a) Only tax relief at the basic rate (so 40% tax payers will not get the extra). A strong possibility.
b) Scrap tax relief on contributions entirely. Unlikely, I feel, as the current system encourages people on lower incomes to save for their retirement.
c) Scrap salary sacrifice as this reduces national insurance paid to government. Possible. Although this extra perk is helping many company pension schemes reduce their deficits, so would be risky. (Not every pension scheme works this way).

The other possibility is stopping the 25% tax free lump sum. This has been mooted before, but seen as politically risky because those approaching retirement have been promised this money and may change their vote if they don't get it. Personally, I feel it is unlikely. If it is applied to new contributions only that makes everyone's pensions suddenly complicated. Possibly it could happen with some notice (years) or some tapering of the tax free amount. More has been written about this, should you want to search the interwebs.

As for the government not paying out SIPPs ... well, the government doesn't pay out SIPPs anyway. SIPPs belong to the individual, in the same way a savings account does, and the company that looks after if pays it out at the request of the individual. The government is not going to seize (steal) people's money unless we get into apocalypse territory which, as mentioned above, would give you other things to worry about.

MarcoM

TheTracker wrote: »

Whatever your fears you can put your money where your mouth is, we do not need to agree or disagree with your fears to say that. Whether it is reds under the bed (pensions seen as not safe), skepticism about market value and rationality (buy gold), fear of cash holding value (buy bitcoin), or societal collapse (buy food and guns), you have options.

I have never seen you or your posts before, but your opinions on labour leadership seem strong enough that it would seem odd to now plump your coin into something you are so skeptical of. The UK and other western democracies have gone through turbulent times, but markets are far more resilient in the long term than the political whims of our leaders. Your choice is yours to make.

Fair point and I accept your criticism.

on the point of wesfern democracies, i would point out though that Greece is a western democracy and so is Cyprus, this did not stop the respective governments from raiding savings accounts and pensions when they needed to find money.

TheTracker

MarcoM wrote: »

Fair point and I accept your criticism.

on the point of wesfern democracies, i would point out though that Greece is a western democracy and so is Cyprus, this did not stop the respective governments from raiding savings accounts and pensions when they needed to find money.

You need to weigh up the likelihood and choose the right place to put your money to match your estimation.

Do take into consideration how much notice you think you’ll have to react to an increased possibility. Raiding pensions is not as likely to happen next Tuesday as within the next 50 years. And presumably with your antennae you’ll spot warning signs before the rest of us. If you have already spotted strong signals, go all in on gold or what have you.

lolamancity

MarcoM wrote: »

it is not economic collapse i fear, it is a nasty little man with a grudge who will tax people who have worked hard to earn a nest egg.
i also fear his sidekick, who has never worked a day in his life and earnt a living as a back bencher whilst living in a three million quid home and calling himself a socialist...

Wow, just wow

MarcoM

lolamancity wrote: »

Wow, just wow

exactly my thoughts.

I would like to live as a socialist too if that is the lifestyle socialism entails.

srbenjo7

Personally, I would be more worried about a future goverment introducing means testing in order to exclude the more "wealthy" from their entitlement to the state pension.
I don't really mean the rich but more the average man (or woman for the politically correct!) in the street who has worked hard and provided for their own future by saving/investing. Those who have saved and invested for 30+ years into a private pension to provide for their future and have hopefully built up a good pension should never be penalised by the goverment for doing so and have their state pension reduced, subjected to means testing or even withdrawn as a consequence.

I may be a bit paranoid but that is my fear as life expectancy is increasing and retirement and pensions will have to be paid for longer in the future.