"I pay 11% of my pay for my pension..." - don't they get it?
Discussion
On a number of occasions I read public servants on here stating
"I pay 11% of my salary into my pension" as if it is some sort of tax or deduction.
Don't they get that it is a 'saving' that they will get back (plus employer's contribution plus any growth on the savings).
Private employees do this too - we contribute x% into our pension ( it is a tax efficient way of saving, more so if done via salary sacrifice) and some employers also put in X%.
Why don't they get this? Why do some think this is a deduction and not a savings account?
I won't get into the argument of recycled tax revenues!
"I pay 11% of my salary into my pension" as if it is some sort of tax or deduction.
Don't they get that it is a 'saving' that they will get back (plus employer's contribution plus any growth on the savings).
Private employees do this too - we contribute x% into our pension ( it is a tax efficient way of saving, more so if done via salary sacrifice) and some employers also put in X%.
Why don't they get this? Why do some think this is a deduction and not a savings account?
I won't get into the argument of recycled tax revenues!
If you live long enough to claim back all that you put in ;-)
I have chosen not to take any pension arrangements, instead building up savings. I see this as being much more reliable in the uncertain greediness of the future.
It also means I can use as much or as little as I need at any particular time whereas with a pension it is 'trickled' out to you per week.
If I unfortunately discover I have only two years left to live (or something along those lines) then I can go out in style 'so to speak'. I wouldn't have this option on a pension arrangement.
I have chosen not to take any pension arrangements, instead building up savings. I see this as being much more reliable in the uncertain greediness of the future.
It also means I can use as much or as little as I need at any particular time whereas with a pension it is 'trickled' out to you per week.
If I unfortunately discover I have only two years left to live (or something along those lines) then I can go out in style 'so to speak'. I wouldn't have this option on a pension arrangement.
AJI said:
If you live long enough to claim back all that you put in ;-)
I have chosen not to take any pension arrangements, instead building up savings. I see this as being much more reliable in the uncertain greediness of the future.
It also means I can use as much or as little as I need at any particular time whereas with a pension it is 'trickled' out to you per week.
If I unfortunately discover I have only two years left to live (or something along those lines) then I can go out in style 'so to speak'. I wouldn't have this option on a pension arrangement.
However if you have the good fortune to live a long time your pension planning won't have been very effective from a tax point of view.I have chosen not to take any pension arrangements, instead building up savings. I see this as being much more reliable in the uncertain greediness of the future.
It also means I can use as much or as little as I need at any particular time whereas with a pension it is 'trickled' out to you per week.
If I unfortunately discover I have only two years left to live (or something along those lines) then I can go out in style 'so to speak'. I wouldn't have this option on a pension arrangement.
AJI said:
If you live long enough to claim back all that you put in ;-)
I have chosen not to take any pension arrangements, instead building up savings. I see this as being much more reliable in the uncertain greediness of the future.
It also means I can use as much or as little as I need at any particular time whereas with a pension it is 'trickled' out to you per week.
If I unfortunately discover I have only two years left to live (or something along those lines) then I can go out in style 'so to speak'. I wouldn't have this option on a pension arrangement.
The only reason I've not done the same is the tax relief, meaning that for every £6 I pay, my pension investment is £10.I have chosen not to take any pension arrangements, instead building up savings. I see this as being much more reliable in the uncertain greediness of the future.
It also means I can use as much or as little as I need at any particular time whereas with a pension it is 'trickled' out to you per week.
If I unfortunately discover I have only two years left to live (or something along those lines) then I can go out in style 'so to speak'. I wouldn't have this option on a pension arrangement.
Kermit power said:
AJI said:
If you live long enough to claim back all that you put in ;-)
I have chosen not to take any pension arrangements, instead building up savings. I see this as being much more reliable in the uncertain greediness of the future.
It also means I can use as much or as little as I need at any particular time whereas with a pension it is 'trickled' out to you per week.
If I unfortunately discover I have only two years left to live (or something along those lines) then I can go out in style 'so to speak'. I wouldn't have this option on a pension arrangement.
The only reason I've not done the same is the tax relief, meaning that for every £6 I pay, my pension investment is £10.I have chosen not to take any pension arrangements, instead building up savings. I see this as being much more reliable in the uncertain greediness of the future.
It also means I can use as much or as little as I need at any particular time whereas with a pension it is 'trickled' out to you per week.
If I unfortunately discover I have only two years left to live (or something along those lines) then I can go out in style 'so to speak'. I wouldn't have this option on a pension arrangement.
If you are paying into a pension fund then (unless its a final salary scheme and there aren't many of those left) you run the risk that your investment pot shrinks instead of continuing to grow. It will reflect market conditions. There are many people who bought into private pension schemes in the 80s and now wish they didn't. Getting tax relief on contributions is not much consolation if, when you come to draw your pension, the value of your pot is worth of what you were told it would be worth when you took it out. Add to all this of course the fact that you are effectively employing an organisation to manage your pension affairs for you, and they will want paying for the service they provide. It comes out of your pot.
If you are privately saving you need to make sure that you do not dip into your pot when the inevitable rainy days come along, and you also need to keep a sharp eye on interest rates/ stock market movements in order to maximise your returns.
Anybody got a crystal ball to see which will have been the best choice to have made 25 years before you retire?
rs1952 said:
Kermit power said:
AJI said:
If you live long enough to claim back all that you put in ;-)
I have chosen not to take any pension arrangements, instead building up savings. I see this as being much more reliable in the uncertain greediness of the future.
It also means I can use as much or as little as I need at any particular time whereas with a pension it is 'trickled' out to you per week.
If I unfortunately discover I have only two years left to live (or something along those lines) then I can go out in style 'so to speak'. I wouldn't have this option on a pension arrangement.
The only reason I've not done the same is the tax relief, meaning that for every £6 I pay, my pension investment is £10.I have chosen not to take any pension arrangements, instead building up savings. I see this as being much more reliable in the uncertain greediness of the future.
It also means I can use as much or as little as I need at any particular time whereas with a pension it is 'trickled' out to you per week.
If I unfortunately discover I have only two years left to live (or something along those lines) then I can go out in style 'so to speak'. I wouldn't have this option on a pension arrangement.
If you are paying into a pension fund then (unless its a final salary scheme and there aren't many of those left) you run the risk that your investment pot shrinks instead of continuing to grow. It will reflect market conditions. There are many people who bought into private pension schemes in the 80s and now wish they didn't. Getting tax relief on contributions is not much consolation if, when you come to draw your pension, the value of your pot is worth of what you were told it would be worth when you took it out. Add to all this of course the fact that you are effectively employing an organisation to manage your pension affairs for you, and they will want paying for the service they provide. It comes out of your pot.
If you are privately saving you need to make sure that you do not dip into your pot when the inevitable rainy days come along, and you also need to keep a sharp eye on interest rates/ stock market movements in order to maximise your returns.
Anybody got a crystal ball to see which will have been the best choice to have made 25 years before you retire?
I recently got my latest pension statement from my employer(private pension), which all be told is worth actually very little. I was alittle angry with the amount I have been putting in and what my 3 different level of return could be. Certainly made me sit and take stock of the situation and rethink my current pension requirements
NST
johnfm said:
On a number of occasions I read public servants on here stating
"I pay 11% of my salary into my pension" as if it is some sort of tax or deduction.
Don't they get that it is a 'saving' that they will get back (plus employer's contribution plus any growth on the savings).
Private employees do this too - we contribute x% into our pension ( it is a tax efficient way of saving, more so if done via salary sacrifice) and some employers also put in X%.
Why don't they get this? Why do some think this is a deduction and not a savings account?
I won't get into the argument of recycled tax revenues!
I think I get you point, but maybe you don't get theirs?"I pay 11% of my salary into my pension" as if it is some sort of tax or deduction.
Don't they get that it is a 'saving' that they will get back (plus employer's contribution plus any growth on the savings).
Private employees do this too - we contribute x% into our pension ( it is a tax efficient way of saving, more so if done via salary sacrifice) and some employers also put in X%.
Why don't they get this? Why do some think this is a deduction and not a savings account?
I won't get into the argument of recycled tax revenues!
I paid more than 11% into my police pension, which was (and is) a whole lot more than friends paid into (then) similar company schemes.
Every month for 15 years.
Yet still get I hammered with the same old line that my free pension makes up for everything I had to do/put up with and I should have expected to work free overtime/get shot at/have no say in my ongoing conditions as I get this great free pension at the end and isn't it great that it may or may not be secured?
Well it wasn't free.
I paid for it. It's mine.
And it isn't that secure is it?
For the record, I now have a non-contributory company pension that is better that the police one. Go figure.
rs1952 said:
Parrot of Doom said:
meh, if I run out of money I'm flogging the house and buying a narrowboat.
I have had similar ideas (the Kennet & Avon canal is just down the road) but I couldn't get my half a century's worth of accumulated junk into one 
davemac250 said:
Yet still get I hammered with the same old line that my free pension makes up for everything I had to do/put up with
That's because so many other Civil Servants state that to be the case for them . . . it's very difficult for the public to know the real detail of the Pubic Sector pensions. When you have people retiring early on full final salary pension (Teachers, Police, stressed Council workers) it's even harder for us to see that your pensions are not any better than ours . . .davemac250 said:
I think I get you point, but maybe you don't get theirs?
I paid more than 11% into my police pension, which was (and is) a whole lot more than friends paid into (then) similar company schemes.
Every month for 15 years.
No, you didn't pay for it - you paid for a small portion of it, the taxpayer covers the rest. Your friends in private pension schemes paid for 100% of theirs.I paid more than 11% into my police pension, which was (and is) a whole lot more than friends paid into (then) similar company schemes.
Every month for 15 years.
Rollin said:
youngsyr said:
davemac250 said:
I paid for it. It's mine.
Well, estimates of the public sector pensions deficit vary between £600 billion and £1 trillion, so clearly not every public sector worker has paid for their pension.TEKNOPUG said:
My dad retired @ 50 after 25 years in the public services. He reckons that he got more back in the first 2 years of his pension than he ever paid in during 21years of continual employment. He retired 15 years ago. You do the sums.
I recently looked at my Dad's teachers' pension. It worked out that as long as he contributed whilst a higher rate payer (he is) and received his pension whilst a basic rate payer (he will), he would be paid the total of his contributions in under 5 years of retirement. Or in other words, he'd be paid 20% of the value of his total contributions every year of his retirement.
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