Private pension age going up from 55.....

[sidicks]

Kinkell said:

Inflation and Ftse are major influences in the economy yet annuity pricing choose to ignore them.

You don't match a guarantee liability (annuity) with a highly volatile / risky asset (FTSE).

Most annuities are not inflation linked, so this is also irrelevant

Kinkell said:

A retired pensioner with 7.5k annuity living in his own bought council house is as well off as his retired from the dole neighbour living in his State funded council house. That's the 150k pot analogy

Irrelevant to annuity pricing..,

Kinkell said:

My great grand parents and grand parents lived longer than my parents. Have a wander round a graveyard and there are plenty of long lived dead ppeople from previous centuries resting in peace. Seven score and ten was life expectancy centuries ago.

No it wasn't.

Kinkell said:

My generation should be retiring earlier. The goalposts have been moved and simply saying its because we are getting older does not sit well.

Basic maths tells you that if you are going to live much longer in retirement then retiring earlier is going to require a pension pot which is multiples of what was previously required...

[GAjon]

I'll ask this question again in a different way.

In broad brush figures; Assuming you are entitled to a state pension and assuming you have no other form of retirement income.

You have to be able to provide yourself with a c12k a year pension.

So any pension savings you have have need to be able to buy an annuity of around £5k a year, which, as it stands today you would need around a £100k pension fund.

So the notion that of next April if your 55years of age you can draw out all your pension pot is not correct?

[XJ Flyer]

fblm said:

Sheepshanks said:

fandango_c said:

Sidicks is contributing, he's one of the few people on this thread who know what they're talking about.

He might know what's he's talking about but the vast majority of his posts are just having a go at people. Doesn't come across well.

Sidicks is invariably right about all things pension related and frankly shows an extraordinary level of patience responding to posts from people without a fvcking clue, which are without fail long on opinion and short on facts.

I'd suggest that the fact that no bank would be stupid enough to give me £500,000 as a lump sum to buy a house with or for that matter £5,000,000 to buy up a whole street.On the basis that I'll pay it back at £500-£5,000 per week from the age of 65 and if I die before the money is all paid back tough they lose the difference,shows who's got a clue in this case.

Edited by XJ Flyer on Thursday 24th July 15:18

[XJ Flyer]

sidicks said:

Kinkell said:

100k pot bought 7k annuity 20 years ago but nowadays circa 5k. Do your expert arithmetic taking inflation into account over this period and they have been halved in value whilst ftse has gained in value. A few years ago 150k pot was the minimum before you were better off than your lazy dole loving neighbour on enhanced benefits in retirement. Pension company takes 20% of fund if you move provider equating to significant reduction on retirement.

Perhaps you can explain relevance of the FTSE and inflation (rather than interest rates)....

Would it not be correct to say that pension funds are often either invested in property or the stock market thereby subject to the equivalent fluctuations.The question then being wether pension funds perform as well for those who's money it is as they do for the financial services industry.Let alone the issue of pension providers then cutting payouts by whatever means using the excuse that people are 'living longer'.As the saying goes I'm out.Let the bankers find some other mug to rip off.

[XJ Flyer]

GAjon said:

I'll ask this question again in a different way.

In broad brush figures; Assuming you are entitled to a state pension and assuming you have no other form of retirement income.

You have to be able to provide yourself with a c12k a year pension.

So any pension savings you have have need to be able to buy an annuity of around £5k a year, which, as it stands today you would need around a £100k pension fund.

So the notion that of next April if your 55years of age you can draw out all your pension pot is not correct?

If pensions are such a good deal for pensioners you can bet that there'd be mortgages and buy to let mortgages available on the same terms as pensions.No surprise that isn't the case and equally no surprise that the bankers don't seem so confident about life expectancy in the case of them lending money as taking it.

[anonymous-user]

XJ Flyer said:

fblm said:

Sheepshanks said:

fandango_c said:

Sidicks is contributing, he's one of the few people on this thread who know what they're talking about.

He might know what's he's talking about but the vast majority of his posts are just having a go at people. Doesn't come across well.

Sidicks is invariably right about all things pension related and frankly shows an extraordinary level of patience responding to posts from people without a fvcking clue, which are without fail long on opinion and short on facts.

I'd suggest that the fact that no bank would be stupid enough to give me £500,000 as a lump sum to buy a house with or for that matter £5,000,000 to buy up a whole street.On the basis that I'll pay it back at £500-£5,000 per week from the age of 65 and if I die before the money is all paid back tough they lose the difference,shows who's got a clue in this case.

Edited by XJ Flyer on Thursday 24th July 15:18

I long since stopped reading your myriad bizarre posts so have no clue, or interest in, what you are talking about.

[XJ Flyer]

fblm said:

XJ Flyer said:

fblm said:

Sheepshanks said:

fandango_c said:

Sidicks is contributing, he's one of the few people on this thread who know what they're talking about.

He might know what's he's talking about but the vast majority of his posts are just having a go at people. Doesn't come across well.

Sidicks is invariably right about all things pension related and frankly shows an extraordinary level of patience responding to posts from people without a fvcking clue, which are without fail long on opinion and short on facts.

I'd suggest that the fact that no bank would be stupid enough to give me £500,000 as a lump sum to buy a house with or for that matter £5,000,000 to buy up a whole street.On the basis that I'll pay it back at £500-£5,000 per week from the age of 65 and if I die before the money is all paid back tough they lose the difference,shows who's got a clue in this case.

Edited by XJ Flyer on Thursday 24th July 15:18

I long since stopped reading your myriad bizarre posts so have no clue, or interest in, what you are talking about.

It seems a clear enough analogy to me.I'm just reversing the deal which the bankers are offering pensioners.But,no surprise,obviously such a deal wouldn't be on the table in that case.I've got no interest in what the pension providers are saying to justify the rip off idea of pensions either.

[mjb1]

sidicks said:

You wouldn't have to take an annuity - you'd be able to take the fund value as cash, I think.

GAjon said:

I'll ask this question again in a different way.

In broad brush figures; Assuming you are entitled to a state pension and assuming you have no other form of retirement income.

You have to be able to provide yourself with a c12k a year pension.

So any pension savings you have have need to be able to buy an annuity of around £5k a year, which, as it stands today you would need around a £100k pension fund.

So the notion that of next April if your 55years of age you can draw out all your pension pot is not correct?

So which one of you is correct, I'd be grateful if someone could confirm the above? GAJon - where are you reading the information about needing to buy a 12k annuity before taking the remainder as cash?

Under the existing rules you can take a lump sum (25% of the pot I think) TAX FREE. With the new rules, you can take more lump sum, but you pay tax on any and all of it. For a lot of people I'm guessing they'll be paying higher rate tax on their lump sum?

[sidicks]

mjb1 said:

So which one of you is correct, I'd be grateful if someone could confirm the above? GAJon - where are you reading the information about needing to buy a 12k annuity before taking the remainder as cash?

Under the existing rules you can take a lump sum (25% of the pot I think) TAX FREE. With the new rules, you can take more lump sum, but you pay tax on any and all of it. For a lot of people I'm guessing they'll be paying higher rate tax on their lump sum?

Tonker was asking about a particular scenario for someone with a serious illness and minimal life expectancy.

[sidicks]

XJ Flyer said:

I'd suggest that the fact that no bank would be stupid enough to give me £500,000 as a lump sum to buy a house with or for that matter £5,000,000 to buy up a whole street.On the basis that I'll pay it back at £500-£5,000 per week from the age of 65 and if I die before the money is all paid back tough they lose the difference,shows who's got a clue in this case.

Edited by XJ Flyer on Thursday 24th July 15:18

Shows how little you know...

1) banks don't (in fact legally CAN'T) provide annuities

2) if you had the same capital backing and secure framework, regulated by the PRA with appropriate collateral, you might well be able to get a loan on similar terms to those stated.

[sidicks]

XJ Flyer said:

If pensions are such a good deal for pensioners you can bet that there'd be mortgages and buy to let mortgages available on the same terms as pensions.No surprise that isn't the case and equally no surprise that the bankers don't seem so confident about life expectancy in the case of them lending money as taking it.

Your obsession with 'bankers' and ignorance about life expectancy apparently knows no bounds.

Have you heard of equity release mortgages...

Edited by sidicks on Thursday 24th July 16:31

[GAjon]

mjb1 said:

sidicks said:

You wouldn't have to take an annuity - you'd be able to take the fund value as cash, I think.

GAjon said:

I'll ask this question again in a different way.

In broad brush figures; Assuming you are entitled to a state pension and assuming you have no other form of retirement income.

You have to be able to provide yourself with a c12k a year pension.

So any pension savings you have have need to be able to buy an annuity of around £5k a year, which, as it stands today you would need around a £100k pension fund.

So the notion that of next April if your 55years of age you can draw out all your pension pot is not correct?

So which one of you is correct, I'd be grateful if someone could confirm the above? GAJon - where are you reading the information about needing to buy a 12k annuity before taking the remainder as cash?

Under the existing rules you can take a lump sum (25% of the pot I think) TAX FREE. With the new rules, you can take more lump sum, but you pay tax on any and all of it. For a lot of people I'm guessing they'll be paying higher rate tax on their lump sum?

Ive read it in several articles on draw down and flexible draw dowm options, but its not clear to me either, hence the question.
Where are the experts when you need them???

This of course is another problem, its as the rules are now and next year. Will they change again in a few years time?

[anonymous-user]

anonymous said:

[redacted]

That's the new rule coming into play isn't it?. Take the lot as cash, pay income tax and then do what you want with what's left.

[sidicks]

XJ Flyer said:

Would it not be correct to say that pension funds are often either invested in property or the stock market thereby subject to the equivalent fluctuations

Pensions (ie funds invested pre retirement) are invested in whatever the owner chooses to invest in, which could be stock market or property.

For obvious reasons (to those who know what they are talking about) annuities are not invested in the same way...

XJ Flyer said:

The question then being wether pension funds perform as well for those who's money it is as they do for the financial services industry.

Which is primarily driven by what markets the individual has chosen to invest in and how that asset class has performed.

XJ Flyer said:

Let alone the issue of pension providers then cutting payouts by whatever means using the excuse that people are 'living longer'

The value of a pension fund is a function of the underlying asset performance. The provider cannot change that.

The cost of an annuity is driven by a) interest rates, b) longevity and c) inflation (for an RPI-linked annuity).

You might be aware of what has happened with long-term interest rates over the last 5+ years and annuitant longevity has increased substantially over the last 10+ years (according to those in the know - actuaries).

You claim otherwise (but with nothing to support those claims).

XJ Flyer said:

As the saying goes I'm out.Let the bankers find some other mug to rip off.

As the saying goes, you are a total . While annuities won't be for everyone your lack of understanding is incredible.

By the way, which banks are offering annuities...

ETA



Play nicely now.

Edited by Big Al. on Thursday 24th July 22:34

[sidicks]

GAjon said:

Ive read it in several articles on draw down and flexible draw dowm options, but its not clear to me either, hence the question.
Where are the experts when you need them???

This of course is another problem, its as the rules are now and next year. Will they change again in a few years time?

Ask "XJ Flyer" he seems to think he is some sort of expert...

[PurpleMoonlight]

To access Flexible Drawdown you need a guaranteed pension income of £12,000 from the election date to the following 5th April. This is not the same as £12,000 pa unless the election is made on 6th April.

Come 6th April 2015 this will no longer apply and everyone in defined contribution arrangements will, in theory, be able to access unlimited drawdown. I say in theory because pension providers will not be obliged to offer it. It may be necessary to transfer to a product that does.

Interestingly, the Government is also proposing some changes to annuities, allowing the income to reduce in later life, additional lump sums to be paid and even a lump sum death benefit. Of course, any additional benefits will likely lower the guaranteed monthly payment.

[XJ Flyer]

sidicks said:

XJ Flyer said:

I'd suggest that the fact that no bank would be stupid enough to give me £500,000 as a lump sum to buy a house with or for that matter £5,000,000 to buy up a whole street.On the basis that I'll pay it back at £500-£5,000 per week from the age of 65 and if I die before the money is all paid back tough they lose the difference,shows who's got a clue in this case.

Edited by XJ Flyer on Thursday 24th July 15:18

Shows how little you know...


1) banks don't (in fact legally CAN'T) provide annuities

2) if you had the same capital backing and secure framework, regulated by the PRA with appropriate collateral, you might well be able to get a loan on similar terms to those stated.

I wasn't asking for an 'annuity' I was asking for a 'loan/mortgage' on similar/same terms as an 'annuity'.In which case just like a mortgage the loan is secured on the property it's lent against.

So I ask again what bank or mortgage lender would be stupid enough to lend me money on those terms.In which I take out the mortgage and only need to start to repay it at age 65 at typical annuity pension rates IE £100 per week for every £100,000 borrowed.With all the outstanding loan payments/debt being written off and my estate keeps the property assuming I die at any time after taking out the loan.The fact that they wouldn't is proof of the scam that is the pensions 'industry'.

Edited by XJ Flyer on Thursday 24th July 18:59

[Murph7355]

XJ Flyer said:

I wasn't asking for an 'annuity' I was asking for a 'loan/mortgage' on similar/same terms as an 'annuity'.In which case just like a mortgage the loan is secured on the property it's lent against.

So I ask again what bank or mortgage lender would be stupid enough to lend me money on those terms.In which I take out the mortgage and only need to start to repay it at age 65 at typical annuity pension rates IE £100 per week for every £100,000 borrowed.With all the outstanding loan payments/debt being written off and my estate keeps the property assuming I die at any time after taking out the loan.The fact that they wouldn't is proof of the scam that is the pensions 'industry'.

Edited by XJ Flyer on Thursday 24th July 18:59

On the basis of the financial acumen you've exhibited on the last two pages I'd be surprised if a bank would lend you £5 for your lunch.

You really need to spend a bit of time understanding these things better before (a) arguing with someone who does it for a living and (b) you retire.

[fandango_c]

XJ Flyer said:

I wasn't asking for an 'annuity' I was asking for a 'loan/mortgage' on similar/same terms as an 'annuity'.In which case just like a mortgage the loan is secured on the property it's lent against.

So I ask again what bank or mortgage lender would be stupid enough to lend me money on those terms.In which I take out the mortgage and only need to start to repay it at age 65 at typical annuity pension rates IE £100 per week for every £100,000 borrowed.With all the outstanding loan payments/debt being written off and my estate keeps the property assuming I die at any time after taking out the loan.The fact that they wouldn't is proof of the scam that is the pensions 'industry'.

Edited by XJ Flyer on Thursday 24th July 18:59

Very odd question - unsurprisingly there aren't any banks which you be stupid enough to offer the loan that you mention. Why would a bank want exposure to mortality risk?

You seem to be very confused between what banks do and what insurance companies do.

[sidicks]

fandango_c said:

Very odd question - unsurprisingly there aren't any banks which you be stupid enough to offer the loan that you mention. Why would a bank want exposure to mortality risk?

You seem to be very confused between what banks do and what insurance companies do.

Indeed. As well as the covenant of a regulated insurance company compared to a random bloke off pistonheads...