Will the OAP exist for me?
Discussion
GT03ROB said:
I expect to see us moving more towards asset based taxation so what works today in laying down assets for the future may not be effective tomorrow.
This strikes me as inevitable, but I can't see any way around it - it works an incentive to save more rather than less for me.rossub said:
I think that's perfectly fair to be honest. The vast majority of pensioners income goes straight back out to the economy through the purchase of essentials - which in turn generates taxation and on the cycle goes. All that is lost the minute you f
k off abroad.
Have you seen the size of the trade deficit the UK has? Taking the above option adds to it.
You're clearly far more at ease with the gov bullying you to do what they want during the years which are presumably meant for you to do as you please with the money which you are forced to pay during your working life.k off abroad.Have you seen the size of the trade deficit the UK has? Taking the above option adds to it.
Personally, I'm not.
DoubleTime said:
You're clearly far more at ease with the gov bullying you to do what they want during the years which are presumably meant for you to do as you please with the money which you are forced to pay during your working life.
Personally, I'm not.
But it's not the money you paid in during your working life. That went to pay the pensions of the day. The money you get as a pensioner is the money paid by people working during your retirement. Personally, I'm not.
GT03ROB said:
I can see then worrying you, but shouldn't confuse you. It's simple, whatever you do the objective is the same maximize income in retirement. There are a number of different ways to do this & a combination of methods is probably the way forward. I expect to see us moving more towards asset based taxation so what works today in laying down assets for the future may not be effective tomorrow. Company based schemes can be very effective at present if the company matches your contributions & you pay any income tax. ISA's will be very effective long term in providing tax free income, but you are contributing out of taxed income.
Whatever you do your pot will not be big enough!!
I'm not very good with money Whatever you do your pot will not be big enough!!
But I understand the point of them.
I would agree about the asset based taxation at some point as many Landlords don't pay the appropriate amount of tax. Can't say I blame them for trying.
Oh well.
Hopefully I will die before I have to worry about it. The one thing I don't want to do is get to 85, have a tube up my nose and £100k sat in the bank. I'd rather put that towards a Ferrari / Lambo.
My old man retired recently, he has lived an average but good financial life but has a pretty good pension and treated himself to a new Jag - Good man, that's what I'd like to do if I could
but he's far more money-wise than me. eltax91 said:
TartanPaint said:
xjay1337 said:
A couple of properties netting £800-£1k rent PCM and you are laughing.
Unless they're empty. Or need repairs. Or the government change how BTL income is taxed. Or... or... or...You can't sell the properties either, or you'll have to pay CGT on that, and presumably be unable to replace them like for like at the time, so you'll take a big dent in your capital if you decide you'd prefer an annuity.
I have no pension to speak of other than the state, but will have a few modest rental properties mortgage-free by retirement age. I'm not sure it's such a great idea. It's certainly not laughing.
EDIT: Yeah, what Rob said ^^
DoubleTime said:
Additionally, as far as I'm aware, if you decided to retire at the gov approved age and say adios with a big smile on your face and take off to a nice and sunny climate such as the Philippines or Thailand the fkers freeze your pension at the rate when you leave. No further increases like you would receive if you stay in cold/expensive UK.
Which is nice.
Talk about a Piss take.
Not necessarily. It depends on the country and whether there is a reciprocal agreement in place with the UK. kers freeze your pension at the rate when you leave. No further increases like you would receive if you stay in cold/expensive UK. Which is nice.
Talk about a Piss take.
https://www.gov.uk/government/publications/state-p...
The above link shows that there is a reciprocal agreement with the Philippines, meaning a pensioner can benefit from annual increases, but not for Thailand under current legislation.
Moonhawk said:
State pension system is in essence a glorified Ponzi scheme.
The entirety of goverment finances in run on a ponzi basis. It only works because there's always a government and they have the power to raise taxes. Right now they're worried that even that won't work, hence the austerity programme.As of 2016, the 'average' Brit paid £287,963 in income tax, £169,371 in VAT, £107,045 in national insurance contributions and £65,068 in council tax. Now, if NIC alone funds one's state pension and if the state pension is worth many, many times that sum combined, and if we have become used to a low tax, low inflation (!), low pay environment could someone tell me where the magic money tree is planted?
Restoring gender inequality is at the heart of the WASPI campaign. There is a great case to be made for shipbuilders, steelworkers, trawlermen, service personnel coal miners to receive early benefits because they tend to lead shorter lives. And this was touched upon in a consultation last year. Alas, you don't read of many, generally, longer living women campaigning to be allowed the right to shovel coal at 0430.
In all but name, the campaign for women to have their state pension rights restored, wants to reverse changes which were known about in 1993/4. I can see a plausible case made for those who have been (genuinely) caught short by change acceleration introduced in 2011. But the idea that you can get an actuarially reduced state pension for early access is only going to cause campaigning women with comfy middle class final salary pensions to take less state pension, work fewer hours and be more tax efficient.
Restoring gender inequality is at the heart of the WASPI campaign. There is a great case to be made for shipbuilders, steelworkers, trawlermen, service personnel coal miners to receive early benefits because they tend to lead shorter lives. And this was touched upon in a consultation last year. Alas, you don't read of many, generally, longer living women campaigning to be allowed the right to shovel coal at 0430.
In all but name, the campaign for women to have their state pension rights restored, wants to reverse changes which were known about in 1993/4. I can see a plausible case made for those who have been (genuinely) caught short by change acceleration introduced in 2011. But the idea that you can get an actuarially reduced state pension for early access is only going to cause campaigning women with comfy middle class final salary pensions to take less state pension, work fewer hours and be more tax efficient.
CoolHands said:
I'm expecting a state pension. They can hardly withdraw it when I (we've) been planning on it. You can get a statement of how much state pension you've already accrued, and the NPA is also set (68 for you I believe).
Just because you expect it at a certain age doesnt mean the government will honour it. Pushing the pension age further out is a form of soft default, kicking the can etc. NickCQ said:
GT03ROB said:
I expect to see us moving more towards asset based taxation so what works today in laying down assets for the future may not be effective tomorrow.
This strikes me as inevitable, but I can't see any way around it - it works an incentive to save more rather than less for me.But see the furore over a one off social care levy, its untenable. Besides which the political class still won't play ball, re HS2, foreign aid, whilst Cameron's father hides his money offshore. Also if you haven't got assets then you can just roll along as usual, and the dont give a f
k brigade carry on as usual. It's too easy to coast in this country. Fuelled by this thread and a conversation with some friends I decided to try to work out how much pension I may get.
I 'retired' 6 years ago and draw a company pension since then I haven't paid NIC....well I did in the first year as I did a bit of contracting.
I have 41 years contributions according to the hmrc site. Trying to work out how much I will get at 66 in 4.5 years in state pension is very difficult to work out.
You need to understand COPE. And of course when I stopped working I had sufficient stamps for a full pension. Now it appears I don't and to get those stamps I have to pay in about £700 per for £4.45 per week. Up to a maximum of full pension.
Any body know a good site that explains all this with decent examples?
Clearly I need to do more research and contact my pension provider but how many more people are in the same boat as me?
I 'retired' 6 years ago and draw a company pension since then I haven't paid NIC....well I did in the first year as I did a bit of contracting.
I have 41 years contributions according to the hmrc site. Trying to work out how much I will get at 66 in 4.5 years in state pension is very difficult to work out.
You need to understand COPE. And of course when I stopped working I had sufficient stamps for a full pension. Now it appears I don't and to get those stamps I have to pay in about £700 per for £4.45 per week. Up to a maximum of full pension.
Any body know a good site that explains all this with decent examples?
Clearly I need to do more research and contact my pension provider but how many more people are in the same boat as me?
otherman said:
The entirety of goverment finances in run on a ponzi basis. It only works because there's always a government and they have the power to raise taxes. Right now they're worried that even that won't work, hence the austerity programme.
The state pension doesn't have to be though. It could be run on a similar premise to a private pension - i.e. your NIC/stamp is invested into your own pension pot over your lifetime - which then pays out when you reach state pension age.
Of course - transitioning to such a system would have it's own problems as you would have to finance two parallel pension systems for at least a couple of generations.
33q said:
Fuelled by this thread and a conversation with some friends I decided to try to work out how much pension I may get.
I 'retired' 6 years ago and draw a company pension since then I haven't paid NIC....well I did in the first year as I did a bit of contracting.
I have 41 years contributions according to the hmrc site. Trying to work out how much I will get at 66 in 4.5 years in state pension is very difficult to work out.
You need to understand COPE. And of course when I stopped working I had sufficient stamps for a full pension. Now it appears I don't and to get those stamps I have to pay in about £700 per for £4.45 per week. Up to a maximum of full pension.
Any body know a good site that explains all this with decent examples?
Clearly I need to do more research and contact my pension provider but how many more people are in the same boat as me?
Does this site not tell you?I 'retired' 6 years ago and draw a company pension since then I haven't paid NIC....well I did in the first year as I did a bit of contracting.
I have 41 years contributions according to the hmrc site. Trying to work out how much I will get at 66 in 4.5 years in state pension is very difficult to work out.
You need to understand COPE. And of course when I stopped working I had sufficient stamps for a full pension. Now it appears I don't and to get those stamps I have to pay in about £700 per for £4.45 per week. Up to a maximum of full pension.
Any body know a good site that explains all this with decent examples?
Clearly I need to do more research and contact my pension provider but how many more people are in the same boat as me?
https://www.gov.uk/check-state-pension
I logged in a week or so back and it told me how many years contributions I still need to make - what my state pension would be based on the contributions I have already made and what the maximum will likely be if I get to full contributions.
As a 44yo bloke I'm of the view that:
1) State pension is a Ponzi scheme
2) I fully expect pension age to be moved out to (at least) 70 for people of my age. Average life expectancy is 83 for British males, so I've got 13 years to fund.
3) I'm treating anything from the Govt as a 'nice to have'.
4) I am making my own private provision (a substantial amount relative to my gross income) but only because I am caught by IR35 legislation as a contractor, it is tax-efficient for me to do so.
5) If I should croak before retirement then my pension pot is payable to my wife as a death benefit, which would help with the upbringing of our son, currently 2.
Morbid as it is to say, I'm worth a lot more financially to my dependents if I were to croak before retirement than I am to make that magic date. We sometimes joke about what the missus is putting in my dinner!
Not surely what I think about means-testing the State Pension though; those who would likely lose out are those who over time are likely to have put the most in, it is very 'unfair' on them to tell them that they'll get squat but lesser contributors will get some. Given the furore over the Bedroom Tax (impacting far fewer people, I imagine) then I would file means testing of the State Pension in the big tray labelled 'Election Loser'. It might have some justification in some quarters (ditto winter heating allowance for all) but it would be a very brave decision to make.
Edit: as a capitalist with a heart, if I look back over the last 20 years I would have invested in several BTLs in my area (Reading) given the frankly incredible rise in property prices in that time. I could have been sitting pretty on a portfolio of a few and not worried about pensions in the slightest by now. I'm not bitter that I didn't (it's all about risk/reward - I didn't take the risk) and doff my cap to those that were savvy enough to ride that wave at the time, but the consequence is that as well as a few wealthy BTL-ers I also know many people in their late twenties/early thirties who have all but given up hope of ever owning their own home. That depresses me a bit, that one generation (rightly) looking after their own interests in retirement have contributed to screwing over the next. Just my take on the whole explosion in BTL over the last 20 years.
1) State pension is a Ponzi scheme
2) I fully expect pension age to be moved out to (at least) 70 for people of my age. Average life expectancy is 83 for British males, so I've got 13 years to fund.
3) I'm treating anything from the Govt as a 'nice to have'.
4) I am making my own private provision (a substantial amount relative to my gross income) but only because I am caught by IR35 legislation as a contractor, it is tax-efficient for me to do so.
5) If I should croak before retirement then my pension pot is payable to my wife as a death benefit, which would help with the upbringing of our son, currently 2.
Morbid as it is to say, I'm worth a lot more financially to my dependents if I were to croak before retirement than I am to make that magic date. We sometimes joke about what the missus is putting in my dinner!
Not surely what I think about means-testing the State Pension though; those who would likely lose out are those who over time are likely to have put the most in, it is very 'unfair' on them to tell them that they'll get squat but lesser contributors will get some. Given the furore over the Bedroom Tax (impacting far fewer people, I imagine) then I would file means testing of the State Pension in the big tray labelled 'Election Loser'. It might have some justification in some quarters (ditto winter heating allowance for all) but it would be a very brave decision to make.
Edit: as a capitalist with a heart, if I look back over the last 20 years I would have invested in several BTLs in my area (Reading) given the frankly incredible rise in property prices in that time. I could have been sitting pretty on a portfolio of a few and not worried about pensions in the slightest by now. I'm not bitter that I didn't (it's all about risk/reward - I didn't take the risk) and doff my cap to those that were savvy enough to ride that wave at the time, but the consequence is that as well as a few wealthy BTL-ers I also know many people in their late twenties/early thirties who have all but given up hope of ever owning their own home. That depresses me a bit, that one generation (rightly) looking after their own interests in retirement have contributed to screwing over the next. Just my take on the whole explosion in BTL over the last 20 years.
Edited by PurpleTurtle on Tuesday 7th March 12:57
PurpleTurtle said:
As a 44yo bloke I'm of the view that:
1) State pension is a Ponzi scheme
2) I fully expect pension age to be moved out to (at least) 70 for people of my age. Average life expectancy is 83 for British males, so I've got 13 years to fund.
No, average life expectancy is not the same as 70 plus expected future lifetime at age 70!1) State pension is a Ponzi scheme
2) I fully expect pension age to be moved out to (at least) 70 for people of my age. Average life expectancy is 83 for British males, so I've got 13 years to fund.
I think you'll find current population life expectancy for a 70-year old is 85 and higher than that for those with private pensions, due to selection effects.
Along with others, I recognise that the contributions made by future working population will not be sufficient to pay the future retired population what the currently retired population currently enjoy.
Future governments will need to make cumulative changes to bring the two cashflows closer, including raising State Retirement Age, Means testing State Pension benefits etc.
Whilst we can bask in the extended warmth of charity knowing that those who have made no provision throughout their working lives will basically need to be supported by those who have, I think those with disposable incomes in their working lives now need to focus on three objectives:
1. anticipating how much we need to live on in future - in UK or in a lower-cost and/or lower-taxed country
2. saving sufficiently to achieve that, without expectation of support from the State Pension
3. sheltering as much as possible from both the increasing number of dependents across society, and the government who will compulsorily 'redistribute' it on our behalf. Legally. Obviously.
Future governments will need to make cumulative changes to bring the two cashflows closer, including raising State Retirement Age, Means testing State Pension benefits etc.
Whilst we can bask in the extended warmth of charity knowing that those who have made no provision throughout their working lives will basically need to be supported by those who have, I think those with disposable incomes in their working lives now need to focus on three objectives:
1. anticipating how much we need to live on in future - in UK or in a lower-cost and/or lower-taxed country
2. saving sufficiently to achieve that, without expectation of support from the State Pension
3. sheltering as much as possible from both the increasing number of dependents across society, and the government who will compulsorily 'redistribute' it on our behalf. Legally. Obviously.
33q said:
Now it appears I don't and to get those stamps I have to pay in about £700 per for £4.45 per week.
Taking my tin hat off now, this appears to be a fantastic investment - c.30% yield, and risk-free to the extent that it is government-backed!Edited by sideways sid on Tuesday 7th March 13:08
OP here - not posted for a while
The vast majority of people here seem to suggest I should not rely on a pension provision when I retire. It will be means tested and only the poor will get government aid.
Maybe I need to start leading a lavish lifestyle, get that Ferrari on credit and generally live to reduce my accounts to zero by the time I'm 70. This way I will no longer have means and I will get state funded.
The vast majority of people here seem to suggest I should not rely on a pension provision when I retire. It will be means tested and only the poor will get government aid.
Maybe I need to start leading a lavish lifestyle, get that Ferrari on credit and generally live to reduce my accounts to zero by the time I'm 70. This way I will no longer have means and I will get state funded.
eltax91 said:
OP here - not posted for a while
The vast majority of people here seem to suggest I should not rely on a pension provision when I retire. It will be means tested and only the poor will get government aid.
Maybe I need to start leading a lavish lifestyle, get that Ferrari on credit and generally live to reduce my accounts to zero by the time I'm 70. This way I will no longer have means and I will get state funded.
Unfortunately that does appear to be the way the world works!The vast majority of people here seem to suggest I should not rely on a pension provision when I retire. It will be means tested and only the poor will get government aid.
Maybe I need to start leading a lavish lifestyle, get that Ferrari on credit and generally live to reduce my accounts to zero by the time I'm 70. This way I will no longer have means and I will get state funded.
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