Example of things not to do regarding retirement

bostonerimus

This is an interesting article about one woman's finances and the issue of her increased state pension age.

https://www.theguardian.com/money/2018/sep/29/raising-the-state-pension-age-has-meant-hardship-for-many-women

What I took from it was that she has had access to a fair amount of capital and income and it's good that she has done things to supplement her income. But sh has made a couple of big errors IMHO.

1) She should not be giving money to children to buy property. The children have more years to earn than she does and she needs that money to generate retirement income.
2) She has been very naive with her investing.....cash ISAs and premium bonds are not going to give any real growth.

crv1963

It's an interesting perspective. There's a few points that crossed my mind- helping children, I'm all for that and help my sons if I can but only while I earn. Very clear once we retire then my TFLS is part of our retirement plan so not to expect anything.

I think that it was probably unwise to part with sums of money to children when you don't know how your budget will work out.

Also my sister is 60 this month but isn't in the least put out by having her pension age pushed back, she says even if she could she wouldn't retire for another 5 years anyway as she has a mortgage and is saving hard so she can really enjoy her job now and retirement later. She is not particularly a feminist but she tells me that "you have to take the good with the bad, if 66 or 67 is good enough for a man why would anyone think a woman couldn't work to then? Women live longer on average than men anyway!"

So I think it depends on an individuals circumstances, mind I'm glad I'm not a manual laborer working outside - now that could seriously be difficult as you age male or female!

JoeEngland

bostonerimus wrote: »

This is an interesting article about one woman's finances and the issue of her increased state pension age.

https://www.theguardian.com/money/2018/sep/29/raising-the-state-pension-age-has-meant-hardship-for-many-women

What I took from it was that she has had access to a fair amount of capital and income and it's good that she has done things to supplement her income. But sh has made a couple of big errors IMHO.

1) She should not be giving money to children to buy property. The children have more years to earn than she does and she needs that money to generate retirement income.
2) She has been very naive with her investing.....cash ISAs and premium bonds are not going to give any real growth.

She had a mortgage free house worth 600k and so should have no trouble tiding herself over to 66. There are parts of the country where you can get a nice 3 bedroom detached house for 250k, which could have given ~350k after moving. I imagine there are women in genuine hardship as a result of the pension age change, but she isn't one of them.

hugheskevi

£300,000 from ex-partner
£52,000 inheritance
£488,000 from house price inflation

£838,000 of unearned income, and with those amounts being from the past will be worth more in today's terms. So fair to say about £1 million.

Aye, life is a struggle, and so unfair...

Zorillo

I'm struggling to find too much to feel sorry about for her.

DairyQueen

Zorillo wrote: »

I'm struggling to find too much to feel sorry about for her.

Agreed.

Nobody in their right mind gives away assets that they may need ('will need' in this instance apparently) deserves any sympathy.

I know plenty of women who thanks to raising children, or caring for elderly relatives, and/or working part-time to facilitate both roles (no company pension paid to part-timers back in the day), are entirely reliant on the state pension. Some (those who naively paid the 'reduced married woman' NI rate) are in very dire straits.

It has nothing to do with the increase in female SP age, and everything to do with social norms decades ago that ensured that females (the 'carers') are seriously lacking in company/private pension provision.

This woman has been incredibly fortunate and Lord knows why the Guardian sees fit to publish her story as a justification for WASPI.

GibbsRule_No3

After the first rise in SP age, I should have been receiving my SP this month, but now won’t get it until March 2020. I did not mind the first rise, it is the extra months that have been now added that bug me. I’d like to hear from men born on my birthday who now have to wait until 66 and how they feel. I have dropped to three days a week but the SP will pay my rent, did not earn enough as a single female, paying rent, to be able to buy a Property, hence the rent until I die. When I do get there I will, agreed, have a “comfortable” continuing lifestyle. BTW with my three day week and a colleague on maternity leave for a year, and only 16 hour a week over three days replacement for the maternity cover, the rest of our workmates are suffering and having to cover for us, when I go they will replace with a full time person. So it is not just me feeling fed up.

xylophone

I have dropped to three days a week

Enabled by having drawn a couple of (presumably index linked) DB pensions....

https://forums.moneysavingexpert.com/discussion/5904563/example-of-things-not-to-do-regarding-retirement

have taken my two FS pensions (so I can work 3 day week until SP kicks in) but have made sure I'm paying into the works Stakeholder pension and I will only do it for three years, I look at it as another lump sum that is gaining far better than I could get elsewhere, especially with the company paying in 9%.

will also have another small private pension and (presumably) are benefiting from being able to make good any COPE deduction from the state pension?

Not too dusty really?:)

JoeEngland

Zorillo wrote: »

I'm struggling to find too much to feel sorry about for her.

It's a typical Guardian nonsense piece.

kidmugsy

"I live alone and, at 63, had expected to be drawing a state pension by now." Expected when? Is she one of those dozy women who ignored the huge notice period for women's pension age going up to 65?

"Women of my age ... workplace pensions were not routinely offered as they are now." I dare say that different people experienced different things, but my wife was always offered workplace pensions. And with earlier scheme retirement ages than her male colleagues.

"Women of my age ... often gave up work to be full-time parents and/or carers of the elderly." But she didn't have to care for her parents for long, did she? Indeed it doesn't say actually that she cared for them at all, so I suspect that she didn't.

"I have to wait another three years, and am getting by on the minimum wage earned from my part-time job as a charity administration assistant. Last year that amounted to £2,500." Are jobs particularly hard to come by where she lives? She is (we must assume) in good health so why is she working so few hours per week?

Is she just another entitled Guardian reader?

kidmugsy

And another thing. Do her numbers make sense? She was born in '54 and bought her house in the late '90s, so she was in her mid forties when she bought it.

Later she implies she bought the house at age 41 (59 less 18 years).

Maybe it would be ignoble to expect her to be accurate about age. Or maybe the Guardian journalist is innumerate - they almost always are.