Pension I am a wondering......

HotDog2020

xylophone said:

 I am 40 this is based on there will be no state pension when I grow up. 

Have you checked your state pension forecast?

https://www.gov.uk/check-state-pension

Assume you mean grow old rather than grow up?

The governement seems to have decided not to have national insurance any more 

I don't understand this statement.

See https://www.litrg.org.uk/tax-nic/national-insurance#:~:text=From 6 January 2024, the,NIC is no longer due.

But  it's true to say that just a state pension won't  provide for a comfortable retirement.

It will provide a secure and index linked base on which you can build.

From 8 April, a full new state pension will be  over £11,500 a year.

It would be a good idea to increase your workplace pension contributions by what you can afford.

https://www.moneyhelper.org.uk/en/tools-and-calculators?gad_source=1&gclid=EAIaIQobChMIsMzfr5yLhQMVAJNQBh05rQC8EAAYAiAAEgL_mfD_BwE&gclsrc=aw.ds

Thanks Xylophone, I have checked my state pension forecast, but this could be scrapped am I really very much too paranoid? Have I been on planet gaga, I thought the drop in contributions to National insurance meant a drop in living stadards for pensioners and likely no future pension. I hear politicians saying they want to scrap it, I cannot understand why? Unless we have to start funding this future ourselves. 

I prefer grow up to grow old 😁

Your link does not really tell me why they are doing it or what it means.

HotDog2020

Dazed_and_C0nfused said:

HotDog2020 said:

Marcon said:

HotDog2020 said:

Thanks @Marcon I know it is a lot, but if there is no state pension when I come to retirment age what am I going to live on? I work for a lovely company but tight on cash they pay only the bare minimum. 

Also I did have a role where I earnt I think 18kpa not that long ago for a short time, now I am on 28kpa, I know that I can live on both, I may not have the disposable and I will feel the pinch, but if I learn to live on less I may have a future. However you may be right and it is too restrictive however my mother has said a few times that if I was to have less wages there will be less to spend on food - I always live within my means. I have planned week to week money, I have have planned to eat healthier, I am starting a new plan on April 2nd, however the shopping arrives 29.03.24 so will start then. I am waffling. 

I just have been worried about having a future and I have been worried about my health at the same time - it might be that if I am saving into a pension I will want my health to be better otherwise there is no point. And I know a few seniors in my industry and they are not on the ball, most senior people do not work for a good reason. I don't want to end up without a pension and without a job. Also this is based on retiring at 70!

I think working on the premise that you'll retire at 70 and there'll be no state pension is probably a tad pessimistic - actually rather more than just a tad!

Taking steps to improve your health would give you a much better quality of life both in the immediate and longer term, so that's definitely something worth doing.

Do you really think it is pessimistic? I thought the governement stopping National insurance contributions meant an end to pension am I wrong? and they keep saying they want to scrap the pension, or am I just reading all the scaremongering media? How could it be that a continual reduction in National insurance mean that I get a pension in the future?

I am hoping you can tell me something I am missing?

Where have you read that?

Will you be voting for a party that proposes scrapping the State Pension?

You don't have to pay NI to accrue qualifying years for State Pension.

The Lower Earnings Level of £131/week is key to that and that could still be monitored even if the NI rate payable by employees was 0%.

I just see snippets on the news, I am not really clued up in what it all means that is why I am here I guess. Is there a party that is scrapping state pension? I would like to avoid that! I know reform want to reduce benefits but I didn't think they wanted to get rid of pension?

But if we are all paying less and less into state pension how can we afford to have a state pension?

I am also @daze

HotDog2020

NoMore said:

 I thought the governement stopping National insurance contributions meant an end to pension am I wrong? 

Yes, your wrong, even if they scrap NI, there is no intention to scrap the State pension, your entitlement will just be tracked in a different way, that's to be decided when (if) they remove NI.

Wowser, I really hope you are correct as I am basing my future income on this bit of information does everyone else agree? I still think I would like to increase pension to 10% for the time being. Thank you, I really appreciate this forum.

Dazed_and_C0nfused

HotDog2020 said:

Dazed_and_C0nfused said:

HotDog2020 said:

Marcon said:

HotDog2020 said:

Thanks @Marcon I know it is a lot, but if there is no state pension when I come to retirment age what am I going to live on? I work for a lovely company but tight on cash they pay only the bare minimum. 

Also I did have a role where I earnt I think 18kpa not that long ago for a short time, now I am on 28kpa, I know that I can live on both, I may not have the disposable and I will feel the pinch, but if I learn to live on less I may have a future. However you may be right and it is too restrictive however my mother has said a few times that if I was to have less wages there will be less to spend on food - I always live within my means. I have planned week to week money, I have have planned to eat healthier, I am starting a new plan on April 2nd, however the shopping arrives 29.03.24 so will start then. I am waffling. 

I just have been worried about having a future and I have been worried about my health at the same time - it might be that if I am saving into a pension I will want my health to be better otherwise there is no point. And I know a few seniors in my industry and they are not on the ball, most senior people do not work for a good reason. I don't want to end up without a pension and without a job. Also this is based on retiring at 70!

I think working on the premise that you'll retire at 70 and there'll be no state pension is probably a tad pessimistic - actually rather more than just a tad!

Taking steps to improve your health would give you a much better quality of life both in the immediate and longer term, so that's definitely something worth doing.

Do you really think it is pessimistic? I thought the governement stopping National insurance contributions meant an end to pension am I wrong? and they keep saying they want to scrap the pension, or am I just reading all the scaremongering media? How could it be that a continual reduction in National insurance mean that I get a pension in the future?

I am hoping you can tell me something I am missing?

Where have you read that?

Will you be voting for a party that proposes scrapping the State Pension?

You don't have to pay NI to accrue qualifying years for State Pension.

The Lower Earnings Level of £131/week is key to that and that could still be monitored even if the NI rate payable by employees was 0%.

I just see snippets on the news, I am not really clued up in what it all means that is why I am here I guess. Is there a party that is scrapping state pension? I would like to avoid that! I know reform want to reduce benefits but I didn't think they wanted to get rid of pension?

But if we are all paying less and less into state pension how can we afford to have a state pension?

I am also @daze

If there is it's not one that is likely to be elected.

You are the person suggesting the State Pension could be scrapped!

I would focus less on tabloid tittle tattle (if that's even what it is) and getting that 4% increased to 10%.  Your future self will thank you 😊

xylophone

 Hints about an ambition/long term aim/ this year, next year, sometime, never, to scrap NI?

The link  I gave explains the current system and it seems the system for years to come.

https://www.theguardian.com/uk-news/2024/mar/13/jeremy-hunt-plan-to-scrap-employee-national-insurance-long-term-ambition

If NI goes, no doubt some other form of tax will replace it.

I doubt that any politician thinks he'll court votes by proposing to scrap the state pension.

In the meanwhile, if you are hoping for a comfortable retirement, get saving more into your pension.

badmemory

There is one reason they reduced NI rather than general tax & it has only one thing to do with the state pension.  That is to ensure that state pensioners DID NOT get a reduction in their tax as they do not pay NI.  I fully expect this to eventually go down to 2% just as a qualifier nothing else.  Do you know how many there are less than 15 years off state pension who have not had private pensions accessible to them until recently & certainly no DB pensions.  They want to stop benefit claimants not increase them.  This is of course ignoring the fact that they call state pension a benefit.

RogerPensionGuy

NoMore said:

 I thought the governement stopping National insurance contributions meant an end to pension am I wrong? 

Yes, your wrong, even if they scrap NI, there is no intention to scrap the State pension, your entitlement will just be tracked in a different way, that's to be decided when (if) they remove NI.

I have just read this thread/post and think I am smelling the coffee.

If they say stop NI of generally 8% for most going forwards, I ma guessing they will plonk say 2% or 3% on the 20% Income Tax Rate making it say 23% and the unemployed and pensioners will see their tax slide up.

The NI has now dropped twice clearly showing they don't like/respect people who are not employed.

So as an unemployed person I need to get ready for more tax to be paid I suspect.

xylophone

Do you know how many there are less than 15 years off state pension who have not had private pensions accessible to them until recently & certainly no DB pensions.

Not so sure about that.

If we take a person aged 50 now,  he could have started work  around 1990.

There were certainly DB pensions around then - public service schemes of course, the big banks,  big oil, utilities, transport, supermarket chains  - Sainsbury for example didn't close its DB scheme to new entrants until around the beginning of this century.

And from 1988,  the launch of the personal pension opened up the retirement savings market.

With regard to the state pension, there was SERPS to 2002 and S2P to 2016 which enabled most workers to improve retirement provision over and above the basic state pension.

Automatic enrolment started in 2012.

Kernowshep

RogerPensionGuy said:

NoMore said:

 I thought the governement stopping National insurance contributions meant an end to pension am I wrong? 

Yes, your wrong, even if they scrap NI, there is no intention to scrap the State pension, your entitlement will just be tracked in a different way, that's to be decided when (if) they remove NI.

I have just read this thread/post and think I am smelling the coffee.

If they say stop NI of generally 8% for most going forwards, I ma guessing they will plonk say 2% or 3% on the 20% Income Tax Rate making it say 23% and the unemployed and pensioners will see their tax slide up.

The NI has now dropped twice clearly showing they don't like/respect people who are not employed.

So as an unemployed person I need to get ready for more tax to be paid I suspect.

If I were to bet, I'd say Government will almost certainly use fiscal drag, by freezing tax thresholds, to make more people (working and pensioners) pay more tax, as a result of inflation of their income pushing them to the next tax rate up.

Government will be able to claim they have lowered tax (NI) despite actually receiving more as a result of the above.

They won't want to be seen as having put income tax up by increasing the rate.

Lowering income tax rate costs far more than lowering the NI rate.

NoMore

Yes the loss of NI will have to be recovered somehow, but there is currently no intention to totally scrap the SP as the OP seems to think.