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  • FIRST POST
    • singhini
    • By singhini 8th Mar 18, 10:45 PM
    • 335Posts
    • 199Thanks
    singhini
    Life Expectancy and Pensions
    • #1
    • 8th Mar 18, 10:45 PM
    Life Expectancy and Pensions 8th Mar 18 at 10:45 PM
    I was watching "daily Politcs" today on BBC2 and it included an article on Life expectancy. In short it stated that life expectancy varied around the UK and in particular male life expectancy was 68.2 years in Bloomfield in Blackpool (the shortest) and male life expectancy in Knighsbridge / Belgravia was 89.1 years (the longest) [figures taken from Daily Politics as shown today on BBC2 8th March 2018].


    That made me think, whats the point of sticking money into my pension if im going to be dead at around 78 years old (average of the 2 figures stated above). i feel that im gonna die and the vast majority of my pension money will be stuck in the pension.


    I feel there are too many restrictions on pensions i.e. if you want to consolidate them you need a FA who charges money, if you try to take too much money out you might face tax, you cant have your money when you wany but approx 10 years before state pension age (which seems to constantly go up) etc.....


    i think the daily politics show based their news report on this article which also highlighted that life expectancy in some areas had started to actualy go down (more can be found here http://www.bbc.co.uk/news/health-43317918)


    Why are we allowing our governments to indenture us into pension slavery and torture with our own private pensions, surely we should be allowed to take our private pension when we want and with no restrictions (why this arbitrary figure of 10 years before state pension age, why cant it be aged 50 onwards).


    I then found this aticle which seems to suggest that the average person is no better off with a pension than being on state benefits (https://www.lovemoney.com/news/16879/pension-saving-benefits-flawed)


    What do others think?
Page 1
    • davieg11
    • By davieg11 8th Mar 18, 11:30 PM
    • 273 Posts
    • 159 Thanks
    davieg11
    • #2
    • 8th Mar 18, 11:30 PM
    • #2
    • 8th Mar 18, 11:30 PM
    The life expectancy for my area is 75.4 years. I'm saving into a pension, so that, when I can access it at age 57, I'm going to retire and have some freedom before I die. There is not many restrictions on pensions and you only need an IFA for a transfer of a final salary scheme. I won't pay any tax either. I'll get 25% tax free, then with the tax free allowance plus marriage allowance by the time I'm 57 I should be able to lift 15k per year tax free until state pension kicks in. I'm also getting 32% tax relief on all money I put in, plus a free 10% from my employer. It's a win win situation no matter how you look at it. I'm pretty sure that's much better than any benefits you may or may not get!
    • Brynsam
    • By Brynsam 8th Mar 18, 11:36 PM
    • 956 Posts
    • 631 Thanks
    Brynsam
    • #3
    • 8th Mar 18, 11:36 PM
    • #3
    • 8th Mar 18, 11:36 PM
    What are you planning to live on when you retire? What makes you think there will be any state benefits?

    Annuity rates take life expectancy into account. Some insurers take your postcode into account, too!
    • badmemory
    • By badmemory 9th Mar 18, 12:59 AM
    • 1,628 Posts
    • 2,164 Thanks
    badmemory
    • #4
    • 9th Mar 18, 12:59 AM
    • #4
    • 9th Mar 18, 12:59 AM
    I don't care how long THEY think I am going to live. To quote Clint Eastwood in one of "those" movies - do you feel lucky? THEY think I will only live to 85ish. I am an obstinate SOB so looking at dragging it out to 95 (OK then 90) but there is no way they are going to win this one!

    The way we retire & how we retire & our choices when we retire are ours and ours alone & that can be difficult after being employed for many, many years & doing whatever asked whenever asked. I think this is why life expectancy for some is low
    Last edited by badmemory; 09-03-2018 at 1:09 AM.
    • dunstonh
    • By dunstonh 9th Mar 18, 1:16 AM
    • 92,656 Posts
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    dunstonh
    • #5
    • 9th Mar 18, 1:16 AM
    • #5
    • 9th Mar 18, 1:16 AM
    That made me think, whats the point of sticking money into my pension if im going to be dead at around 78 years old (average of the 2 figures stated above). i feel that im gonna die and the vast majority of my pension money will be stuck in the pension.
    yet over half the people in the UK are expected to live into their 90s now.

    What makes you think the money will be stuck in the pension?

    I feel there are too many restrictions on pensions i.e. if you want to consolidate them you need a FA who charges money, if you try to take too much money out you might face tax, you cant have your money when you wany but approx 10 years before state pension age (which seems to constantly go up) etc.....

    You dont need an FA unless you have safeguarded benefits over 30k.
    You get tax relief in on whole amount but its only taxable on 75% on the way out.
    You can have the money when you want after age 55.

    I then found this aticle which seems to suggest that the average person is no better off with a pension than being on state benefits
    Im not even going to bother reading it as its going to be rubbish if it is telling you that. However, please explain how someone on benefits getting paid 10k a year is better off than someone with pensions getting paid 20k a year?
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
    • Theta101
    • By Theta101 9th Mar 18, 2:08 AM
    • 140 Posts
    • 28 Thanks
    Theta101
    • #6
    • 9th Mar 18, 2:08 AM
    • #6
    • 9th Mar 18, 2:08 AM
    Im not even going to bother reading it as its going to be rubbish if it is telling you that. However, please explain how someone on benefits getting paid 10k a year is better off than someone with pensions getting paid 20k a year?
    I've seen this 20K figure somewhere else but couldn't understand how it's made up.
    It seems far too high for the "average retirement income". I assume it's for an individual and not a couple.

    I've also seen that the average pension pot is 50K.

    The 2 figures just don't make sense.
    • PeacefulWaters
    • By PeacefulWaters 9th Mar 18, 4:54 AM
    • 8,320 Posts
    • 10,638 Thanks
    PeacefulWaters
    • #7
    • 9th Mar 18, 4:54 AM
    • #7
    • 9th Mar 18, 4:54 AM
    Your research is horribly narrow.
    • Lungboy
    • By Lungboy 9th Mar 18, 7:15 AM
    • 1,376 Posts
    • 1,319 Thanks
    Lungboy
    • #8
    • 9th Mar 18, 7:15 AM
    • #8
    • 9th Mar 18, 7:15 AM
    Your research is horribly narrow.
    Originally posted by PeacefulWaters
    And out of date. That Lovemoney article is 5.5 years old and is talking about the old system.
    • Triumph13
    • By Triumph13 9th Mar 18, 7:44 AM
    • 1,180 Posts
    • 1,463 Thanks
    Triumph13
    • #9
    • 9th Mar 18, 7:44 AM
    • #9
    • 9th Mar 18, 7:44 AM
    I then found this aticle which seems to suggest that the average person is no better off with a pension than being on state benefits (https://www.lovemoney.com/news/16879/pension-saving-benefits-flawed)


    What do others think?
    Originally posted by singhini
    To save anyone bothering to read it, that article was from 2012 before the introduction of the single tier pension and highlighted one of the problems with the old state pension that a small private pension income just stopped you getting pension tax credit. The April 2016 changes deliberately targeted this problem by setting the new single tier pension at the pension credit level to ensure this problem no longer arose.
    Individuals receiving housing benefit may still have an issue where a large percentage of pension income gets clawed back in reductions to housing benefit. If you are in this position do you think it's unreasonable that you be coerced into saving money whilst you are working so that other taxpayers don't have to pay all of your rent went you are old?
    • Silvertabby
    • By Silvertabby 9th Mar 18, 9:08 AM
    • 2,749 Posts
    • 3,938 Thanks
    Silvertabby
    Longevity is determined by genes, lifestyle and luck - not your post code.
    • Clifford_Pope
    • By Clifford_Pope 9th Mar 18, 9:22 AM
    • 3,590 Posts
    • 3,740 Thanks
    Clifford_Pope
    Longevity is determined by genes, lifestyle and luck - not your post code.
    Originally posted by Silvertabby
    Post code is an easy and approximate short-cut to other factors:

    Genes - to the extent that there is say a North/South genetic factor, this might have some correlation

    Lifestyle - strongly related to post code, surely?

    Luck - luck's what you make it, and educated people in good jobs in nice areas in nice climates have more luck
    • Prism
    • By Prism 9th Mar 18, 9:35 AM
    • 336 Posts
    • 254 Thanks
    Prism
    I've seen this 20K figure somewhere else but couldn't understand how it's made up.
    It seems far too high for the "average retirement income". I assume it's for an individual and not a couple.

    I've also seen that the average pension pot is 50K.

    The 2 figures just don't make sense.
    Originally posted by Theta101
    Ok here is an example based on the US stock market (the only one I have 40 years of stats for)

    Lets say 40 years ago you decided to put away 80 a month into a pension and invested it in equities. The government tops this up to 100. You increased the amount slightly each year by inflation. The value of that today would be worth around 1.5 million pounds. Had you done the same without a pension then it would be worth around 300k less.

    You can do a lot with that amount of money while retired. Even if someone chose options with a lower return then its still a huge opportunity for a happy retirement.
    • OldMusicGuy
    • By OldMusicGuy 9th Mar 18, 9:48 AM
    • 368 Posts
    • 745 Thanks
    OldMusicGuy
    What do others think?
    Originally posted by singhini
    I think you are looking for excuses to justify not taking responsibility for your future self. Don't worry, it's very common, it's called temporal discounting. As others have pointed out, you are using out of date research and misusing statistics to justify not saving for your future.

    There is more flexibility in pensions than there has ever been, there are more options to manage your money effectively than there have ever been (and I am speaking as someone who has just retired). The reason the government places age restrictions on accessing pension funds is due to the tax benefits, and that's perfectly fair. If they didn't do that, people would use the system to avoid paying tax. If you want to build up tax free savings that you can access any time, use your ISA allowance. A savings strategy that combines ISAs and pensions makes a lot of sense.

    I consolidated pensions without using an FA and it cost nothing. But I don't have any DB pensions. If that's what you have, count yourself very lucky. The restriction there (use an IFA for advice before cashing in a DB pension) is to make sure people don't throw away important long-term benefits due to temporal discounting.
    • Linton
    • By Linton 9th Mar 18, 9:52 AM
    • 9,387 Posts
    • 9,519 Thanks
    Linton
    I've seen this 20K figure somewhere else but couldn't understand how it's made up.
    It seems far too high for the "average retirement income". I assume it's for an individual and not a couple.

    I've also seen that the average pension pot is 50K.

    The 2 figures just don't make sense.
    Originally posted by Theta101
    Does it account for people having more than one pension pot or is it simply the average of all pensions?

    Is it an average over everybody independent of age when what is important is the average total pension pot at retirement?
    • Dorian1958
    • By Dorian1958 9th Mar 18, 9:52 AM
    • 136 Posts
    • 98 Thanks
    Dorian1958

    Genes - to the extent that there is say a North/South genetic factor, this might have some correlation
    Originally posted by Clifford_Pope

    Eh? First I have heard of this. As a Northener should I be worried??
    • westv
    • By westv 9th Mar 18, 9:58 AM
    • 4,525 Posts
    • 2,122 Thanks
    westv
    Your post code may indicate that are more likely to be in a group that has poor lifestyle choices but it doesn't mean that you will do.
    • GunJack
    • By GunJack 9th Mar 18, 10:12 AM
    • 10,119 Posts
    • 7,577 Thanks
    GunJack
    Eh? First I have heard of this. As a Northener should I be worried??
    Originally posted by Dorian1958
    Possibly....there is more than likely still an element of the effect of a much higher proportion of Northern/Welsh having worked for many years in heavy industries like coal & steel...something the majority of the southern softies managed to avoid
    ......Gettin' There, Wherever There is......
    • davieg11
    • By davieg11 9th Mar 18, 10:27 AM
    • 273 Posts
    • 159 Thanks
    davieg11
    Ok here is an example based on the US stock market (the only one I have 40 years of stats for)

    Lets say 40 years ago you decided to put away 80 a month into a pension and invested it in equities. The government tops this up to 100. You increased the amount slightly each year by inflation. The value of that today would be worth around 1.5 million pounds. Had you done the same without a pension then it would be worth around 300k less.

    You can do a lot with that amount of money while retired. Even if someone chose options with a lower return then its still a huge opportunity for a happy retirement.
    Originally posted by Prism
    Sounds good that but 40 years ago my parents got less than 80 per week and dreamed of winning 100k on the pools so that they could retire.
    • Silvertabby
    • By Silvertabby 9th Mar 18, 10:54 AM
    • 2,749 Posts
    • 3,938 Thanks
    Silvertabby
    Post code is an easy and approximate short-cut to other factors:

    Genes - to the extent that there is say a North/South genetic factor, this might have some correlation

    Lifestyle - strongly related to post code, surely?

    Luck - luck's what you make it, and educated people in good jobs in nice areas in nice climates have more luck
    Originally posted by Clifford_Pope
    I grew up in the North and know Blackpool well. My parents and sister thought a day trip 'to see the lights' was a huge treat, but I couldn't stand the place - all stinky fried food and people walking down the street swinging their filthy fags around.

    Of course, you may say that these people only smoked and ate c**p on holiday - but as my parents were also afficionados of working men's clubs (smoke so thick you couldn't see the 'turn' and huge pork pies sold as bar 'snacks') I would have to largely disagree.

    As for luck, it's funny but I have found that the harder I have worked the luckier I have become.
    • westv
    • By westv 9th Mar 18, 11:15 AM
    • 4,525 Posts
    • 2,122 Thanks
    westv
    As for luck, it's funny but I have found that the harder I have worked the luckier I have become.
    Originally posted by Silvertabby
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