Almost nobody in my workplace invests in the stock market for their retirement, it's insane.

noclaf

Without any real stats to back up my assumptions (just a hunch) I would say a lot more folks are clued up on pensions now compared to 20 years back. Clued up could mean many different things but at least 'more aware'. Accessibility for retail investors has also much improved and lower costs, plenty of good content on YT to cover the basics.

I started my first perm job (that included a workplace pension) 18 ish years back but took no interest whatsoever and didn't have a clue about the tax efficiency, funds etc...still recall a few of my colleagues who did take a interest tweaking their funds in our workplace pension and I found it strange. I don't know what eventually clicked but this forum certainly helped me to take my head out of the sand and start research and focus. What's interesting though is that only a v small handful of my colleagues take an interest in this stuff...you can tell fairly quicky who is 'on it's and who clearly isn't but maybe I need to get out more...  

Just to add, it's not always about class or education or lower Vs higher earners....some of my colleagues I am quite sure earn well and then some but the ignorance on pensions is still quite surprising and same goes for taking advantage of maximising the employer contributions...it's just an afterthought. Age likely plays a role too and maybe upbringing.....don't remember my parents telling me to ensure I opted in and contributed etc But it is something I will try to pass on.

eskbanker

DRS1 said:

I am reminded of a comedy sketch involving a shoe - Monty Python?

Ah yes, threads like this do sometimes stray into the classic Four Yorkshiremen territory:

https://genius.com/Monty-python-four-yorkshiremen-live-annotated

It struck me reading the Denis Law tributes and obituaries that he reportedly didn't wear shoes until he was 12, when he was finally given some hand-me-downs....

penners324

If people are making pension contributions then they are investing in the stock market, and it the most tax efficient way.

kempiejon

eskbanker said:

It struck me reading the Denis Law tributes and obituaries that he reportedly didn't wear shoes until he was 12, when he was finally given some hand-me-downs....

I had this story from an elderly relative growing up in Newcastle between the wars, one of 12 kids, top to tail in 3 beds, nay shoes until he joined the RAF. Because they all wore boots, the working class and their kids didn't have shoes. Shoes were for professional types.
I make no comment on Mr Law.

TheBanker

penners324 said:

If people are making pension contributions then they are investing in the stock market, and it the most tax efficient way.

The debate is about what they're investing in though. I know one person whose entire pension is in a Government Bonds fund because he logged in and decided it was best to change it to the lowest risk option available. I cannot convince him this is probably higher risk (in terms of his income when he retires) than a higher risk investment would be!

I also know someone who decided to start investing in a Stocks and Shares ISA when their baby was born. The plan was to gift the money to the child when they were old enough, e.g. for uni fees or a house deposit. They were paying in £50 a month and after three months had a panic when their balance was only £149. They cashed it in and stopped contributing because they didn't want to risk any further loss. The 18 year old child would have been a lot richer if they'd held their nerve. Instead the money's been in cash savings accounts, including during that long period when most savings accounts were paying rates well below 1%.

Altior

eskbanker said:

DRS1 said:

I am reminded of a comedy sketch involving a shoe - Monty Python?

Ah yes, threads like this do sometimes stray into the classic Four Yorkshiremen territory:

https://genius.com/Monty-python-four-yorkshiremen-live-annotated

It struck me reading the Denis Law tributes and obituaries that he reportedly didn't wear shoes until he was 12, when he was finally given some hand-me-downs....

I suppose it's partly due to people putting forward seemingly outlandish claims (to me), stated as fact. Every now and again, on this forum I interject and ask them to back them with some facts. I'm open to being wrong, and developing my own understanding.

Not particularly directed at the poster I quoted, but unfortunately we do have people/posters who seem very often to try and make out it's 'so bad' right now, when it actually isn't. It really isn't, in my view. If it is, however, let's see some tangible evidence. 

The fact that the internet means almost all people can now easily self educate on personal finance is itself completely different to when I was 'young'. Even via their smartphones, never mind using dial up on a Time machine

RL is our employer pension provider, we regularly get RL reps to come in and deliver pension presentations, with AMA time at the end. I work in a fin tech business, with an employee profile that is tilted to the young. Most colleagues have at least a basic grasp of accounting and finance, to get through the door. Almost everyone zones out, so many young people just don't care about pensions. We can vote on where we would like future remuneration and enhanced workplace benefits to be focused. Pensions are always bottom of the table. So we barely get more than the minimum requirement, and it's unlikely to change, alas.  

eskbanker

Altior said:

I suppose it's partly due to people putting forward seemingly outlandish claims (to me), stated as fact. Every now and again, on this forum I interject and ask them to back them with some facts. I'm open to being wrong, and developing my own understanding.

Not particularly directed at the poster I quoted, but unfortunately we do have people/posters who seem very often to try and make out it's 'so bad' right now, when it actually isn't. It really isn't, in my view. If it is, however, let's see some tangible evidence.

Agreed, I'm the same - I'll usually try to source backup and links where applicable/feasible when posting and will also often challenge others to do the same if making apparently unsupported claims.

QrizB

Altior said:

Not particularly directed at the poster I quoted, but unfortunately we do have people/posters who seem very often to try and make out it's 'so bad' right now, when it actually isn't. It really isn't, in my view. If it is, however, let's see some tangible evidence.

In 1991, straight out of Compton sorry uni and before minimum wage legislation, I was pleased to get a casual job on £3.50 an hour. Inflated to today, that would be £7.90. current minimum wage is 50% higher than that so I'd suggest that the low-waged are substantially better off today than they were then.

Altior said:

 RL is our employer pension provider, we regularly get RL reps to come in and deliver pension presentations, with AMA time at the end. I work in a fin tech business, with an employee profile that is tilted to the young. Most colleagues have at least a basic grasp of accounting and finance, to get through the door. Almost everyone zones out, so many young people just don't care about pensions.

Our provider is Scottish Widows. They provide quarterly pensions talks via Teams and it's quite noticeable that most of the self-selecting audience are from the mature end of the age range.

Having said that, a few of the young uns in the office were talking about risking a few hundred on day trading, so us old fogeys pointed out that they had much bigger stock market investments in their pensions. That got them thinking about their investment strategies and at least a few of them decided to increase their contributions from the minimum. So ther might be hope for them yet!

Angelica123

Given that the whole FIRE moment has become more widely known, I think there are more and more people who are thinking about pensions etc even in their 20s. 

I think there is a huge difference between someone who chooses to opt out of a pension and someone who chooses not to invest in stocks and shares. I think I am hard pressed to think of many scenarios where it would not be a good idea to put money into a pensions. Whereas investing is a personal preference - I would think that someone on below average wage probably can't afford to ride the volatility of the market - their priorities probably should be paying into pension and building an emergency fund.

fuzzzzy

[Deleted User] said:

fuzzzzy said:

[Deleted User] said:

fuzzzzy said:

[Deleted User] said:

It just seems like not enough people are being financially responsible and taking steps to ensure they have a comfortable retirement. I absolutely promise you when you're 65 and freezing cold in your home because you can't afford to put the heating on, eating from food banks and having no money to do anything, you'll totally regret not being frugal and investing for your future. 

I absolutely promise you that if in mid-life you ever find yourself in a hospital bed being told your condition could be life threatening you'll totally regret having been frugal.

No-one knows what the future holds for them and so it is also about having a balanced approach. Save a bit, invest a bit, live a bit.

But statistically speaking, the chances of that happening are lower than the chances of it not happening. So you'd rather chose to live your life based on the assumption that the less likely outcome will happen? How does that make sense? 

The average age of death is 82, yes some people die at 40 and some people die at 100 but the average is 82. Therefore one should plan to live to that age. That means having enough money to sustain you to that age, and ideally beyond.

The thought of being too old to work and having no money so I'm cold in my damp home everyday due to lack of heating, hungry, living in poverty, terrified of every little price rise, anxious about whether I'll freeze to death in my home while managing 1 meal a day because that's all I have terrifies me far more than the thought that I'll regret not blowing my pay check every month, going on 4 holidays a year, buying the latest iphone every 2 years etc ever would.

I'm still convinced that the people who are capable of saving by don't have the mindset that "It'll be alright, I'll figure it out." I think they're going to be in for a major reality check once they hit their 60's and realise they messed up financially.

Sorry I just found your thread title a bit alarmist and your tone rather arrogant which is why I mirrored it. But I stand by what I said as that was my experience.

I agree that there will be lots of people who find themselves in later life regretting they did not save for their retirement, but I also that think it is possible to be too frugal and there will be other people who in later life find themselves wishing they had lived a little more. That is why I was advocating a balanced approach.

This is a valid argument but why does it have to be one or the other? Why does it have to be spending every pay check without saving anything vs living like a hermit not spending a penny? 

It's a balance, you can certainly do both. For example saving just £100 a month from age 20 to 60 would be approximately £400,000 (based on historical returns).

Then on top of that you'll have your private pension and on top of that you'd have your state pension once you reach the age. That is a very healthy comfortable retirement, dare I even say luxurious... Heating on 24/7 in winter, holidays with the grandkids, personal holidays with the mrs / mr, eating out at restaurants, taking up new hobbies etc. 

All at the sacrifice of just £100 per month, or £3.30 per day. Seems like such a no brainer to me I genuinely find it hard to believe that so many people (in my place of work) don't think the £100 a month is a worthwhile price to pay.

I never said it had to be one or the other if you read my posts. I have always been a natural saver and I do actually agree with you that people should be saving something towards their retirements, but I am able to understand why some people don't, the possible reasons for which have been mentioned in many other people's posts. The question is how do you encourage people to save something towards their retirements.

Maybe it would be a good thing if auto-enrolment was compulsory, but maybe that would cause too much hardship to some people on low salaries with very high housing costs.

I don't think that pension credit should come with all the freebies, as I don't see that it is fair that some people's income should be supplemented to a level higher than others who are living on just the state pension. The state pension needs to be maintained to keep up with inflation, but I think that pension credit should merely raise income to the level of the state pension without any extras. If there was not the cliff edge there, of potentially losing out by saving, maybe more people on lower incomes would be encouraged to think more about providing for themselves rather than relying on the state.