Times article about pensions
Discussion
Might be of interest to those interested in pensions.....
https://www.thetimes.co.uk/article/the-truth-about...
https://www.thetimes.co.uk/article/the-truth-about...
drainbrain said:
Might be of interest to those interested in pensions.....
https://www.thetimes.co.uk/article/the-truth-about...
As has been stated on numerous ocassions previously, not much to do with pensions (the tax free wrapper[/b] and everything to do with the performance of the underlying investment, which the conusmer has control over!https://www.thetimes.co.uk/article/the-truth-about...
Certainly there will be some people paying for ongoing advice who are not being told to move away from poor performing funds (although of course the relevant metric for fund performance is a relative one against the benchmark, not an absolute one)...
Dunno what you're going on about. The 'pensions' I thought the article was about are the type of pension the OED defines as:
"a regular payment made during a person's retirement from an investment fund to which that person or their employer has contributed during their working life".
It's of zero interest to me anyway. I get the state pension (or tax free wrapper if that's what you want to call it). And I get a piffling waste of time couple of private pensions (or tax free wrappers if that's what you want to call them). Certainly not my idea of how to fund old age.
But....just thought that Times article might be interesting to anyone who IS planning to live off a non-state tax free wrapper when they're old.
Kinda feel sorry for the people - possibly quite large number of people - who're with the more serious swindlers at the lower end of the racket. Guess they end up getting told it's their fault for ...well...for something or other. (Not that that helps much when you've got bills to pay).
(O and 'occasion' has two 'c's and one 's' should you be planning to use it again).
"a regular payment made during a person's retirement from an investment fund to which that person or their employer has contributed during their working life".
It's of zero interest to me anyway. I get the state pension (or tax free wrapper if that's what you want to call it). And I get a piffling waste of time couple of private pensions (or tax free wrappers if that's what you want to call them). Certainly not my idea of how to fund old age.
But....just thought that Times article might be interesting to anyone who IS planning to live off a non-state tax free wrapper when they're old.
Kinda feel sorry for the people - possibly quite large number of people - who're with the more serious swindlers at the lower end of the racket. Guess they end up getting told it's their fault for ...well...for something or other. (Not that that helps much when you've got bills to pay).
(O and 'occasion' has two 'c's and one 's' should you be planning to use it again).
otherman said:
It means that how well a pension investment performs is down to what funds are invested in, which is in the hands of the person whose pension it is.
So is that an oblique way of saying that if you haven't a scooby-doo what funds you should invest in (and have no desire to diversify your expertise into the mysteries of investment) then you shouldn't touch the pension concept even with someone else's bargepole? I kinda agree with that, especially if there's a legion of nightmares out there happy to encourage you to stick your hard earned into their useless schemes which they know very well are useless without The Times telling everybody.
Nice to see the People's Pension provider at the high end of the performance chart, tho. Well done them.
Edited by drainbrain on Saturday 1st July 20:14
drainbrain said:
So is that an oblique way of saying that if you haven't a scooby-doo what funds you should invest in (and have no desire to diversify your expertise into the mysteries of investment) then you shouldn't touch the pension concept even with someone else's bargepole?
No, it's saying that a wrapper and an investment are different and if you don't want to take responsibility for the investment strategy then you need to pay someone else to do so on your behalf.drainbrain said:
I kinda agree with that, especially if there's a legion of nightmares out there happy to encourage you to stick your hard earned into their useless schemes which they know very well are useless without The Times telling everybody.
Nice to see the People's Pension provider at the high end of the performance chart, tho. Well done them.
The fund performance isn't comparable because the risk profiles are quite different. Again another reason why you have a financial advisor to assist you if you can't do it yourself.Nice to see the People's Pension provider at the high end of the performance chart, tho. Well done them.
No surprise that you focus on a typo of mine, rather than bother to try and understand the issues that you are commenting on!
"conusmer" was a typo; "ocassion" was a spelling error. Best learn to spell a word before you use it, especially if adopting a censorious tone. 
.....anyway, if anyone who intends using a pension (as defined by OED) to fund their old age/retirement etc clicks the link in the OP they may see an article which interests them. Clearly the article's author thought it might be of interest.
But if you take issue with the article, be it with its terminology or content or even the fact that it was written at all, then please address your problem(s) either to the article's author or indeed the paper's editor, or even the publisher rather than to me.
If, on the other hand, you want a pointless (and, in terms of this thread irrelevant) quarrel about what 'pension' means or about the intricacies and technicalities of pensions, their advisement or even their worth in this modern age, then pm sid. He should know. He's been selling them for long enough, and is well known for his enthusiasm for pointless acrimony, although less so for its usual outcome.
But if you take issue with the article, be it with its terminology or content or even the fact that it was written at all, then please address your problem(s) either to the article's author or indeed the paper's editor, or even the publisher rather than to me.
If, on the other hand, you want a pointless (and, in terms of this thread irrelevant) quarrel about what 'pension' means or about the intricacies and technicalities of pensions, their advisement or even their worth in this modern age, then pm sid. He should know. He's been selling them for long enough, and is well known for his enthusiasm for pointless acrimony, although less so for its usual outcome.
drainbrain said:
.....anyway, if anyone who intends using a pension (as defined by OED) to fund their old age/retirement etc clicks the link in the OP they may see an article which interests them. Clearly the article's author thought it might be of interest.
But if you take issue with the article, be it with its terminology or content or even the fact that it was written at all, then please address your problem(s) either to the article's author or indeed the paper's editor, or even the publisher rather than to me.
If, on the other hand, you want a pointless (and, in terms of this thread irrelevant) quarrel about what 'pension' means or about the intricacies and technicalities of pensions, their advisement or even their worth in this modern age, then pm sid. He should know. He's been selling them for long enough, and is well known for his enthusiasm for pointless acrimony, although less so for its usual outcome.
Once again you're wrong, as I've never sold pensions. I believe you did though, but I guess you didn't understand them then either?!But if you take issue with the article, be it with its terminology or content or even the fact that it was written at all, then please address your problem(s) either to the article's author or indeed the paper's editor, or even the publisher rather than to me.
If, on the other hand, you want a pointless (and, in terms of this thread irrelevant) quarrel about what 'pension' means or about the intricacies and technicalities of pensions, their advisement or even their worth in this modern age, then pm sid. He should know. He's been selling them for long enough, and is well known for his enthusiasm for pointless acrimony, although less so for its usual outcome.
The points I made in the second post above are key:
1) you need to monitor the investment strategy for your investment to ensure the risk profile remains appropriate for your requirements
2) if you can't do that, pay someone else to do so on your behalf
3) different funds have different risk profiles so can't necessarily be directly compared
4) what was appropriate some time ago may no longer be so today
5) if you want advice about your 'pension', listen to an expert, not someone who doesn't understand the difference between an investment wrapper and an investment!
Edited by sidicks on Saturday 1st July 20:27
The article is discussing pension companies that offer different investment funds within a pension (i.e. tax efficient) wrapper. This is part of the accumulation phase where money is invested to help fund future retirement.
I know at least one of those companies does not pay out a regular income to people in retirement, such as an annuity. An individual's fund would be taken out of the company and used to purchase an annuity, income drawdown products etc.
Pensions are not magical, although the tax relief is fairly close, and people need to take responsibility for their pension (the accumulation of retirement funds), assuming they are investing in one, by either learning what to invest in or seek advice on investing.
I know at least one of those companies does not pay out a regular income to people in retirement, such as an annuity. An individual's fund would be taken out of the company and used to purchase an annuity, income drawdown products etc.
Pensions are not magical, although the tax relief is fairly close, and people need to take responsibility for their pension (the accumulation of retirement funds), assuming they are investing in one, by either learning what to invest in or seek advice on investing.
snabzter said:
... people need to take responsibility for their pension (the accumulation of retirement funds), assuming they are investing in one, by either learning what to invest in or seek advice on investing.
So what do you see as having 'gone wrong' in the poorly performing ones in the article's chart? drainbrain said:
So what do you see as having 'gone wrong' in the poorly performing ones in the article's chart?
It's impossible to say if anything has 'gone wrong' from the article. It also appears to be comparing 'apples' and 'pears' in a number of areas.At least it produces some good headlines for the less well informed!
Edited by sidicks on Saturday 1st July 21:38
sidicks said:
As has been stated on numerous ocassions previously, not much to do with pensions (the tax free wrapper[/b] and everything to do with the performance of the underlying investment, which the conusmer has control over!
Certainly there will be some people paying for ongoing advice who are not being told to move away from poor performing funds (although of course the relevant metric for fund performance is a relative one against the benchmark, not an absolute one)...
100% this. I'm very happy with my pension funds, I've been a bit lucky, but I am fully aware of what's happening and how to get out. I pay for advice. Certainly there will be some people paying for ongoing advice who are not being told to move away from poor performing funds (although of course the relevant metric for fund performance is a relative one against the benchmark, not an absolute one)...
It'd be reasonable to assume that no-one deliberately chose to fund a poorly performing scheme. But some 10's of billions of ££s are supposedly in them. So...
Bad choices on the punters' part? Bad advice from advisers? Or people who want to take so low a risk that their rewards are certain to be 'poor' by 'average' standards?
The article seems to suggest that the latter (low risk/low return investing) plays some role.
But it's also easy to understand why people want to play it safe and careful and not high-risky with their pension savings.
Whole thing's a minefield. And a nightmare.
Bad choices on the punters' part? Bad advice from advisers? Or people who want to take so low a risk that their rewards are certain to be 'poor' by 'average' standards?
The article seems to suggest that the latter (low risk/low return investing) plays some role.
But it's also easy to understand why people want to play it safe and careful and not high-risky with their pension savings.
Whole thing's a minefield. And a nightmare.
drainbrain said:
It'd be reasonable to assume that no-one deliberately chose to fund a poorly performing scheme. But some 10's of billions of ££s are supposedly in them. So...
You can't have ALL funds being above average. HTH.drainbrain said:
Bad choices on the punters' part? Bad advice from advisers? Or people who want to take so low a risk that their rewards are certain to be 'poor' by 'average' standards?
The article seems to suggest that the latter (low risk/low return investing) plays some role.
Generally, lower risk equals lower return over a sensible investment horizon, so that shouldn't be a surprise to anyone.The article seems to suggest that the latter (low risk/low return investing) plays some role.
drainbrain said:
But it's also easy to understand why people want to play it safe and careful and not high-risky with their pension savings.
Whole thing's a minefield. And a nightmare.
So they should expect lower returns in that case. And not compare returns against those who've taken bigger risks.Whole thing's a minefield. And a nightmare.
And take advice if they don't understand what is going on.
1st angry pensioner: "why's my scheme turned out crap"?
Adviser: "Because your low risk profile meant your investment's produced low return in line with reasonable expectations"
2nd angry pensioner: "why's my scheme turned out crap"?
Adviser: "Because your high risk profile meant what it said and, unfortunately it was a high risk too far and it bombed"
3rd angry pensioner: "why's my scheme turned out crap"?
Adviser: "Because your average risk profile wasn't ever going to do any better than mediocre as you would reasonably expect. And I'm afraid mediocre these days is what used to be called crap"
Chorus of angry pensioners: "So you can't win WHATEVER the hell you do"?
Owner of annuity company: " Well I wouldn't say NOBODY can win at pensions. Here, have some of my lobster and a glass of Dom Pom. You'll soon all be dead, so there'll be plenty more where that came from........oink oink!"
Adviser: "Because your low risk profile meant your investment's produced low return in line with reasonable expectations"
2nd angry pensioner: "why's my scheme turned out crap"?
Adviser: "Because your high risk profile meant what it said and, unfortunately it was a high risk too far and it bombed"
3rd angry pensioner: "why's my scheme turned out crap"?
Adviser: "Because your average risk profile wasn't ever going to do any better than mediocre as you would reasonably expect. And I'm afraid mediocre these days is what used to be called crap"
Chorus of angry pensioners: "So you can't win WHATEVER the hell you do"?
Owner of annuity company: " Well I wouldn't say NOBODY can win at pensions. Here, have some of my lobster and a glass of Dom Pom. You'll soon all be dead, so there'll be plenty more where that came from........oink oink!"
Edited by drainbrain on Saturday 1st July 22:30
drainbrain said:
1st angry pensioner: "why's my scheme turned out crap"?
Adviser: "Because your low risk profile meant your investment's produced low return in line with reasonable expectations"
2nd angry pensioner: "why's my scheme turned out crap"?
Adviser: "Because your high risk profile meant what it said and, unfortunately it was a high risk too far and it bombed"
3rd angry pensioner: "why's my scheme turned out crap"?
Adviser: "Because your average risk profile wasn't ever going to do any better than mediocre as you would reasonably expect. And I'm afraid mediocre these days is what used to be called crap"
Chorus of angry pensioners: "So you can't win WHATEVER the hell you do"?
Owner of annuity company: " Well I wouldn't say NOBODY can win at pensions. Here, have some of my lobster and a glass of Dom Pom. You'll soon all be dead, so there'll be plenty more where that came from........oink oink!"
As usual you resort to an ignorant rant. How dull.Adviser: "Because your low risk profile meant your investment's produced low return in line with reasonable expectations"
2nd angry pensioner: "why's my scheme turned out crap"?
Adviser: "Because your high risk profile meant what it said and, unfortunately it was a high risk too far and it bombed"
3rd angry pensioner: "why's my scheme turned out crap"?
Adviser: "Because your average risk profile wasn't ever going to do any better than mediocre as you would reasonably expect. And I'm afraid mediocre these days is what used to be called crap"
Chorus of angry pensioners: "So you can't win WHATEVER the hell you do"?
Owner of annuity company: " Well I wouldn't say NOBODY can win at pensions. Here, have some of my lobster and a glass of Dom Pom. You'll soon all be dead, so there'll be plenty more where that came from........oink oink!"
Edited by sidicks on Saturday 1st July 22:58
You also need to consider what the objectives of the fund are and what the benchmark for the fund is.
If the person has a low risk investment strategy then they should be expecting lower returns hence their pension fund is not expected to earn significant returns. They may have invested in a fund that aimed to earn 2% above cash. If the fund achieved that aim then the person can't complain as the fund aim was clear.
High risk funds have the potential to give high returns but there is also potential for significant losses. Funds state this so it shouldn't be a surprise if the person's pension doesn't give high returns as they are not guaranteed.
Annuity companies don't deal with the accumulation of pension funds. They use the, already accumulated, pension fund to pay out a guaranteed income for life. Annuity companies tend to invest in gilts, corporate bonds etc. as they are expected to be lower risk, hence lower potential returns, but ultimately more likely to continue paying out to the person until they die. Customers don't have a say what annuity companies invest in other than that if the annuity rates are low then customers may be more likely to go to competitors with better annuity rates.
If the person has a low risk investment strategy then they should be expecting lower returns hence their pension fund is not expected to earn significant returns. They may have invested in a fund that aimed to earn 2% above cash. If the fund achieved that aim then the person can't complain as the fund aim was clear.
High risk funds have the potential to give high returns but there is also potential for significant losses. Funds state this so it shouldn't be a surprise if the person's pension doesn't give high returns as they are not guaranteed.
Annuity companies don't deal with the accumulation of pension funds. They use the, already accumulated, pension fund to pay out a guaranteed income for life. Annuity companies tend to invest in gilts, corporate bonds etc. as they are expected to be lower risk, hence lower potential returns, but ultimately more likely to continue paying out to the person until they die. Customers don't have a say what annuity companies invest in other than that if the annuity rates are low then customers may be more likely to go to competitors with better annuity rates.
Oh well. Here's a glass raised to that great army of true believers in the pension system.
May all your pounds become fivers, fivers become tenners, and tenners turn into twenties!!
May you stroll down that bleached white beach like silver panthers, surrounded by gently swaying coconut heavy palms, hand in hand with your silver pantheresses whilst laughing naked native children skip happily alongside you showering you with scented petals and their singing fishermen fathers land another net fat with exotic delicacies for your nightly feasting!!
God bless the scheme managers and all owners of annuity companies everywhere who bestow so many blessings on their happy grateful flock of clients!!
Here's to you all!!
May all your pounds become fivers, fivers become tenners, and tenners turn into twenties!!
May you stroll down that bleached white beach like silver panthers, surrounded by gently swaying coconut heavy palms, hand in hand with your silver pantheresses whilst laughing naked native children skip happily alongside you showering you with scented petals and their singing fishermen fathers land another net fat with exotic delicacies for your nightly feasting!!
God bless the scheme managers and all owners of annuity companies everywhere who bestow so many blessings on their happy grateful flock of clients!!
Here's to you all!!
Edited by drainbrain on Saturday 1st July 23:17
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