How to not be auto enrolled into pensions?

Lemon_dr1zzle

GingerTim said:

Silvertabby said:

Roger175 said:

Here's a tale to make you think - some years ago, when I was probably in my early 40's, I was having a conversation with my brother-in-law. He is 5 years older than me and lives a very different lifestyle. I have always been very health conscious and apart from enjoying a glass of wine or 6 too many on occasions, I am pretty fit and healthy for my age (59 next month). Contrast this with my brother-in-law, who has always eaten total crap and drinks like a fish (I think probably alcoholic), he is seriously overweight (think 25 stone) and has all manner of serious health conditions. He has had both knees replaced and suffers from heart and chest problems etc. You get the picture! Anyway, the chat in question led to me asking him about what he was doing in terms of pension planning - he just burst out laughing, threw his arms in the air and said, "look at me, can you really see me making it to retirement age, not a hope and so I don't bother with all that crap". This is a guy who has always earnt serious money and could easily have set aside a good wedge.  Anyway, you know where this is going!.... 20 years later, and I am winding down to early retirement, my brother-in-law is in a serious way, he can hardly walk and you can see he is in constant pain, yet he simply can't afford to retire and given his lifestyle, he's going to struggle financially even when he gets to SPA. Just saying!

Even sadder.......

A LGPS member opted out and took a refund of his pension contributions to help pay for his wedding.  He said at the time that he would opt back in as soon as he could afford to, but he never did....

Some years and at least a couple of young children later, he was sadly killed in a RTA.  His line manager (who clearly had no idea that anyone would/could opt out of the LGPS) visited his wife to tell her not to worry about money, as she would get a tax free lump sum of 3 X his (substantial) salary plus an enhanced life time pension for her plus pensions for the children until they left Uni.

They didn't get a penny. 

That is horrendous.

And not uncommon 

daz378

Talking to one of my co workers....47 already 25 years of lgps  and she's able to put 300 pound a month away in savings...unlike me though she does overtime....you should have no problem retiring at 60...what's prompted her is seeing colleagues  in their mid 60s struggling  with clients with their personal care...good for her

Emmia

With auto enrollment being required, is there the possibility that the state pension might be all but abolished, or reduced to a minimum level for most people? I think people who don't take up pensions that are offered are totally bonkers, and gambling with their future financial security.

Personally, I opened my first pension at 18, and opted into workplace pensions as soon as I could. I've no particular plans to retire early, but never say never - the option is there. I do however plan to enjoy my retirement.

MallyGirl

They are already at a pretty minimum level - £10k or so does not go far in today's world

Takedap

Lemon_dr1zzle said:

GingerTim said:

Silvertabby said:

Roger175 said:

Here's a tale to make you think - some years ago, when I was probably in my early 40's, I was having a conversation with my brother-in-law. He is 5 years older than me and lives a very different lifestyle. I have always been very health conscious and apart from enjoying a glass of wine or 6 too many on occasions, I am pretty fit and healthy for my age (59 next month). Contrast this with my brother-in-law, who has always eaten total crap and drinks like a fish (I think probably alcoholic), he is seriously overweight (think 25 stone) and has all manner of serious health conditions. He has had both knees replaced and suffers from heart and chest problems etc. You get the picture! Anyway, the chat in question led to me asking him about what he was doing in terms of pension planning - he just burst out laughing, threw his arms in the air and said, "look at me, can you really see me making it to retirement age, not a hope and so I don't bother with all that crap". This is a guy who has always earnt serious money and could easily have set aside a good wedge.  Anyway, you know where this is going!.... 20 years later, and I am winding down to early retirement, my brother-in-law is in a serious way, he can hardly walk and you can see he is in constant pain, yet he simply can't afford to retire and given his lifestyle, he's going to struggle financially even when he gets to SPA. Just saying!

Even sadder.......

A LGPS member opted out and took a refund of his pension contributions to help pay for his wedding.  He said at the time that he would opt back in as soon as he could afford to, but he never did....

Some years and at least a couple of young children later, he was sadly killed in a RTA.  His line manager (who clearly had no idea that anyone would/could opt out of the LGPS) visited his wife to tell her not to worry about money, as she would get a tax free lump sum of 3 X his (substantial) salary plus an enhanced life time pension for her plus pensions for the children until they left Uni.

They didn't get a penny. 

That is horrendous.

And not uncommon 

I spent my whole career working shifts in heavy industry.  You'd be shocked at how many people thought that dying early was a big part of their financial planning.

Pat38493

Emmia said:

With auto enrollment being required, is there the possibility that the state pension might be all but abolished, or reduced to a minimum level for most people? I think people who don't take up pensions that are offered are totally bonkers, and gambling with their future financial security.

Personally, I opened my first pension at 18, and opted into workplace pensions as soon as I could. I've no particular plans to retire early, but never say never - the option is there. I do however plan to enjoy my retirement.

Bonkers maybe but there is also an argument that enrollment should be compulsory rather than having the ability to opt out - you could argue that opting out of this is effectively saying that you expect the general taxpayer to pick up the bill if you can't fund your own retirement.

Flugelhorn

Pat38493 said:

Emmia said:

With auto enrollment being required, is there the possibility that the state pension might be all but abolished, or reduced to a minimum level for most people? I think people who don't take up pensions that are offered are totally bonkers, and gambling with their future financial security.

Personally, I opened my first pension at 18, and opted into workplace pensions as soon as I could. I've no particular plans to retire early, but never say never - the option is there. I do however plan to enjoy my retirement.

Bonkers maybe but there is also an argument that enrollment should be compulsory rather than having the ability to opt out - you could argue that opting out of this is effectively saying that you expect the general taxpayer to pick up the bill if you can't fund your own retirement.

Surely can't be compulsory! People may have vast trust funds hidden away, may have breached the LTA / AA - may already be in receipt of pension (happened to me when employer tried to auto-enrol me - fortunately they listened otherwise the tax bill would have been signficant )

Pat38493

Flugelhorn said:

Pat38493 said:

Emmia said:

With auto enrollment being required, is there the possibility that the state pension might be all but abolished, or reduced to a minimum level for most people? I think people who don't take up pensions that are offered are totally bonkers, and gambling with their future financial security.

Personally, I opened my first pension at 18, and opted into workplace pensions as soon as I could. I've no particular plans to retire early, but never say never - the option is there. I do however plan to enjoy my retirement.

Bonkers maybe but there is also an argument that enrollment should be compulsory rather than having the ability to opt out - you could argue that opting out of this is effectively saying that you expect the general taxpayer to pick up the bill if you can't fund your own retirement.

Surely can't be compulsory! People may have vast trust funds hidden away, may have breached the LTA / AA - may already be in receipt of pension (happened to me when employer tried to auto-enrol me - fortunately they listened otherwise the tax bill would have been signficant )

Good point - theoretically you should then have to show that you have provision elsewhere, but probably unworkable I admit.

AnnoyedEnergyUser

Folks seem very combative with people who take an opposing view.

You would think that pension schemes had never failed, that governments are run incredibly well and don't change the rules whilst you are in schemes and its not guaranteed you will live to enjoy the money.

With that in mind, surely paying off debts, clearing mortgages, having money behind you in case of events is also a sensible alternative wouldn't you say.

As the projection for my pot is at best 30,000 which I can't imagine it would buy that big a pay out. Surely me holding onto that money investing it as I see fit and ensuring I have no debt is sensible enough thank you.

Linton

AnnoyedEnergyUser said:

Folks seem very combative with people who take an opposing view.

You would think that pension schemes had never failed, that governments are run incredibly well and don't change the rules whilst you are in schemes and its not guaranteed you will live to enjoy the money.

With that in mind, surely paying off debts, clearing mortgages, having money behind you in case of events is also a sensible alternative wouldn't you say.

As the projection for my pot is at best 30,000 which I can't imagine it would buy that big a pay out. Surely me holding onto that money investing it as I see fit and ensuring I have no debt is sensible enough thank you.

Pension schemes these days are well protected.  The days of Maxwell pinching the lot are long gone.

There is no guarantee you will live to enjoy the money.  However if you die early you will be dead and wont be in a position to care.  Surely far worse would be living until extreme old age with minimal income worried about whether you can keep warm and continue to enjoy the simple pleasures that improved your life when young. From the Office for National Statistics about  25% of current 40 year olds are expected to die before 80.  The same % are expected to reach 97. Feeling lucky?

Paying off debts etc are essential but not an alternative to preparing for the future.  If you can barely manage now how will you manage on State Pension alone which is at about 50% of full time Minimum Wage?

Pensions allow you to hold onto more money that investing outside a pension.  Some pension schemes allow you to invest very broadly  as you see fit.  Some other pension schemes provide an income  guaranteed for the whole of your life.