Discussion
Mrr T said:
Welshbeef said:
Mrr T said:
It's still quite generous. The life time pot is still over a £1M. While contributions are limited to £40k a year this can be carried forward 3 years if it suits.
The fact you can draw down a pension at 55 and put a lot back significantly increases the benefit as well. Also now you can draw as you want so as to manage your tax bill by keeping at the standard rate.
But the 55 age is moving backwardsThe fact you can draw down a pension at 55 and put a lot back significantly increases the benefit as well. Also now you can draw as you want so as to manage your tax bill by keeping at the standard rate.
If it keeps changing then ISAs will be used instead giving absolute flexibility to the individual away from the govt.
Welshbeef said:
Mrr T said:
Welshbeef said:
Mrr T said:
It's still quite generous. The life time pot is still over a £1M. While contributions are limited to £40k a year this can be carried forward 3 years if it suits.
The fact you can draw down a pension at 55 and put a lot back significantly increases the benefit as well. Also now you can draw as you want so as to manage your tax bill by keeping at the standard rate.
But the 55 age is moving backwardsThe fact you can draw down a pension at 55 and put a lot back significantly increases the benefit as well. Also now you can draw as you want so as to manage your tax bill by keeping at the standard rate.
If it keeps changing then ISAs will be used instead giving absolute flexibility to the individual away from the govt.
Byker28i said:
I own a TVR. They'll be nothing left for the kids 
A man (am I still allowed to use that expression 
) of impeccable taste, my lad is also a TVR fan.He also runs a Cerbi, two 280i coupes. He now does virtually all of his own repairs and maintenance having been ripped off once to many by so called independant specialists.
Cant imagine where he caught the tiv bug
crankedup5 said:
A man (am I still allowed to use that expression ) of impeccable taste, my lad is also a TVR fan.
He also runs a Cerbi, two 280i coupes. He now does virtually all of his own repairs and maintenance having been ripped off once to many by so called independant specialists.
Cant imagine where he caught the tiv bug
) of impeccable taste, my lad is also a TVR fan.He also runs a Cerbi, two 280i coupes. He now does virtually all of his own repairs and maintenance having been ripped off once to many by so called independant specialists.
Cant imagine where he caught the tiv bug
I probably got more properly interested in cars as a young lad when at a small show up in Scotland, and one of the owners of the 2 (at the time) Typhons took me out a very short drive. Got a big fond spot for them - a Sag would probably be a dream car.
crankedup5 said:
I’m not sure what you mean by ‘tax dodging’ tbh, it’s either tax avoidance perfectly legitimate or ‘tax evasion’ illegal whilst living in U.K.
Moving out of the U.K. to better climes purely for financial reasons, well for those people such F1 drivers for example, living in Monaco holds its attractions. Sadly I have not tasted such an attraction.
‘People richer than me’, I used to be vocal when it comes to bonus payments of so many CEO of FTSE Companies. I paid attention to such things far to closely. Discovered life goes on and expect I have greatly moderated my pov as the years rolled by.
I wouldn’t make a good Chancellor.
Yes, I'm clear about the difference between the two. My point was not that, it's more that the financial systems are designed by smart accountants who earn good money for it, as well as typically pretty well off politicians. As a result they'll be making sure they don't tax themselves too heavily on somethings, and make sure there is legal ways to dodge tax. For example person x bought their house back when it was a few thousand quid to do so. Of course inflation adds to it, as well as maintenance through the years. But if they sold now they could probably be pocketing a huge sum that is tax free/ much reduced - through no work of their own, it's just a reflection of the system that we have which pushes house prices up. So they get both a big windfall on wealth, and miss tax. This gets passed onto their kids via gifts and so is still not taxed. That's the sort of thing I mean. It's perfectly legal - but it's a huge financial windfall through no hard work.Moving out of the U.K. to better climes purely for financial reasons, well for those people such F1 drivers for example, living in Monaco holds its attractions. Sadly I have not tasted such an attraction.
‘People richer than me’, I used to be vocal when it comes to bonus payments of so many CEO of FTSE Companies. I paid attention to such things far to closely. Discovered life goes on and expect I have greatly moderated my pov as the years rolled by.
I wouldn’t make a good Chancellor.
If the UK was doing fine on expenditure it'd be no problem. But we're already far in debt, and we have a huge healthcare and pension bubble that is about to hit. We need to get that money from somewhere. I'd say that could be one place to start. And it would hit me too, but looking at the debt we all need to do something, it's got to come from somewhere. Unless of course you believe in MMT - which probably works for a while, but I wonder what the end outcome is. Financial systems always fail, and one of the things with MMT is it could completely destroy the value/confident in money, which would be a very strange world.
Byker28i said:
I own a TVR. They'll be nothing left for the kids
At least you don't have expensive European nights watching Spuds this year, so that saves you a bit! Welshbeef said:
Mrr T said:
Welshbeef said:
Mrr T said:
It's still quite generous. The life time pot is still over a £1M. While contributions are limited to £40k a year this can be carried forward 3 years if it suits.
The fact you can draw down a pension at 55 and put a lot back significantly increases the benefit as well. Also now you can draw as you want so as to manage your tax bill by keeping at the standard rate.
But the 55 age is moving backwardsThe fact you can draw down a pension at 55 and put a lot back significantly increases the benefit as well. Also now you can draw as you want so as to manage your tax bill by keeping at the standard rate.
If it keeps changing then ISAs will be used instead giving absolute flexibility to the individual away from the govt.
Leaving aside employer contributions, for every £60 I've put in my pension over the past 2 decades, HMRC have put in £40, and I've benefitted from growth on that contribution at a compound rate of getting on for 7%.
Sure, some of my pension will get taxed on the way out, but between the tax free lump sum and the extra investment gains made over the years on HMRC's contributions, I just can't imagine that ISAs will ever be a better retirement investment vehicle before I reach the LTA, and even then, I think only if I could somehow persuade my employer to pay the same matched contributions they currently do into my pension.
The government has to tread the right line between encouraging people to save for their retirement whilst also keeping them in the workforce long enough that mass early retirements don't create a totally impossible need for immigration to replace them.
All things considered, it seems like a fair position at the moment, and won't stop me imploring my kids to start paying into pensions from their very first pay cheques. I just wish I could've told my younger self to start then, as I reckon the extra 8 years would've let me walk away on my 55th birthday without even needing to give it a second thought...
Kermit power said:
The government has to tread the right line between encouraging people to save for their retirement whilst also keeping them in the workforce long enough that mass early retirements don't create a totally impossible need for immigration to replace them.
All things considered, it seems like a fair position at the moment, and won't stop me imploring my kids to start paying into pensions from their very first pay cheques. I just wish I could've told my younger self to start then, as I reckon the extra 8 years would've let me walk away on my 55th birthday without even needing to give it a second thought...
This, both points hit the nail on the head. Rather than pump money into a pension I gave it lip service and overpaid my mortgage, so am having to play catch up now, the trouble is I'm comfortable from age 67 when the state pension kicks in, but not really enough before that unless I draw out the pot, so it's a balancing act finding where the point to retire is...All things considered, it seems like a fair position at the moment, and won't stop me imploring my kids to start paying into pensions from their very first pay cheques. I just wish I could've told my younger self to start then, as I reckon the extra 8 years would've let me walk away on my 55th birthday without even needing to give it a second thought...
It's why I try to chat to my younger colleagues about pensions, retirement, because noone did with me. However at the moment they are still into the material things, new cars, lifestyle, or thinking about buying a house... Pensions are a long way down the road - same as I thought...
Byker28i said:
Kermit power said:
The government has to tread the right line between encouraging people to save for their retirement whilst also keeping them in the workforce long enough that mass early retirements don't create a totally impossible need for immigration to replace them.
All things considered, it seems like a fair position at the moment, and won't stop me imploring my kids to start paying into pensions from their very first pay cheques. I just wish I could've told my younger self to start then, as I reckon the extra 8 years would've let me walk away on my 55th birthday without even needing to give it a second thought...
This, both points hit the nail on the head. Rather than pump money into a pension I gave it lip service and overpaid my mortgage, so am having to play catch up now, the trouble is I'm comfortable from age 67 when the state pension kicks in, but not really enough before that unless I draw out the pot, so it's a balancing act finding where the point to retire is...All things considered, it seems like a fair position at the moment, and won't stop me imploring my kids to start paying into pensions from their very first pay cheques. I just wish I could've told my younger self to start then, as I reckon the extra 8 years would've let me walk away on my 55th birthday without even needing to give it a second thought...
It's why I try to chat to my younger colleagues about pensions, retirement, because noone did with me. However at the moment they are still into the material things, new cars, lifestyle, or thinking about buying a house... Pensions are a long way down the road - same as I thought...
Welshbeef said:
How about this as a solution
Give the 8%
Withdraw winter fuel allowance
Add NI / rather than be a tax break after a set age.
If you are going to change the ‘deal’ on NI then you might as well abolish it altogether and adjust income tax accordingly.Give the 8%
Withdraw winter fuel allowance
Add NI / rather than be a tax break after a set age.
I ‘contracted out’ for NI contributions and, as such, my state pension entitlement was reduced. If I now have to continue paying NI in to my dotage will it be at the contracted out rate with a reduced state pension, contracted in rate with a reduced state pension or contracted in rate with a reinstated full pension?
Garvin said:
If you are going to change the ‘deal’ on NI then you might as well abolish it altogether and adjust income tax accordingly.
I ‘contracted out’ for NI contributions and, as such, my state pension entitlement was reduced. If I now have to continue paying NI in to my dotage will it be at the contracted out rate with a reduced state pension, contracted in rate with a reduced state pension or contracted in rate with a reinstated full pension?
Contracting out and the impact thereof is an utterly confusing conundrum as far as I'm concerned!I ‘contracted out’ for NI contributions and, as such, my state pension entitlement was reduced. If I now have to continue paying NI in to my dotage will it be at the contracted out rate with a reduced state pension, contracted in rate with a reduced state pension or contracted in rate with a reinstated full pension?
I opted out for about 7 years, IIRC, before they removed the possibility to do so, and have a £62k SERPS replacement pension pot as a result. When I check the "how much pension will you get" on .go.uk, however, it tells me that I have full NI contributions for every year I was opted out, and that so long as I work for another 4 years before I retire, I'll have enough years of full NI contributions to qualify for full State pension, despite the fact that it also confirms that I opted out for a while. Whenever I look at that page, I remember to be grateful to the friend of my parents back in the mid eighties who told me to register for NI Credit when I started working a fair few hours in my O level year. As a result of that, I'd hit 3 years of contributions out of 35 required before I even took my A levels!
Kermit power said:
Garvin said:
If you are going to change the ‘deal’ on NI then you might as well abolish it altogether and adjust income tax accordingly.
I ‘contracted out’ for NI contributions and, as such, my state pension entitlement was reduced. If I now have to continue paying NI in to my dotage will it be at the contracted out rate with a reduced state pension, contracted in rate with a reduced state pension or contracted in rate with a reinstated full pension?
Contracting out and the impact thereof is an utterly confusing conundrum as far as I'm concerned!I ‘contracted out’ for NI contributions and, as such, my state pension entitlement was reduced. If I now have to continue paying NI in to my dotage will it be at the contracted out rate with a reduced state pension, contracted in rate with a reduced state pension or contracted in rate with a reinstated full pension?
I opted out for about 7 years, IIRC, before they removed the possibility to do so, and have a £62k SERPS replacement pension pot as a result. When I check the "how much pension will you get" on .go.uk, however, it tells me that I have full NI contributions for every year I was opted out, and that so long as I work for another 4 years before I retire, I'll have enough years of full NI contributions to qualify for full State pension, despite the fact that it also confirms that I opted out for a while. Whenever I look at that page, I remember to be grateful to the friend of my parents back in the mid eighties who told me to register for NI Credit when I started working a fair few hours in my O level year. As a result of that, I'd hit 3 years of contributions out of 35 required before I even took my A levels!
Garvin said:
Confusing conundrum is a good expression. I must admit to using the term “reduced state pension” without fully understanding the reduction! I downloaded the ‘instructions’ from the government web site to try and calculate exactly what my state pension would be. I gave up. There will be a reduction but if anyone can make any sense of that ‘paper’ then they are a better man than I!
As I understand it, you may have a reduction, but you won't necessarily have one.When the change was made, HMRC had to impose a reduction for each year you were opted out so as not to unfairly penalise those who didn't opt out, and this amount is called your COPE (Contracted Out Pension Equivalent). In my case it amounts to an overall reduction of £42.47 off whatever my full state pension is when I reach retirement age.
The reason that you may or may not have a reduction is that COPE was calculated in 2016 when the pension system was reworked. Every year you work after that date adds 1/35 of your maximum amount back on, which works out at near enough a fiver per week for every year worked up to the maximum state pension amount.
For me, this means that so long as I work for 9 years from 2016 (which I will), I'll get exactly the same maximum state pension that I would've done had I never opted out, and if my opted-out pension pot carries on pulling in the same sort of 5-7% long term growth that it has done to date, then it will have grown to £160k+ of effectively free cash by the time I reach state retirement age.
Again, the same friend of my parents who told me to register for NI contributions suggested that I opt out and set it up for me, so I shall definitely be buying several pints with the proceeds to toast his memory! 
If you want to, you could double-check my source of information for the above to make sure I've understood it correctly.
Kermit power said:
Garvin said:
Confusing conundrum is a good expression. I must admit to using the term “reduced state pension” without fully understanding the reduction! I downloaded the ‘instructions’ from the government web site to try and calculate exactly what my state pension would be. I gave up. There will be a reduction but if anyone can make any sense of that ‘paper’ then they are a better man than I!
As I understand it, you may have a reduction, but you won't necessarily have one.When the change was made, HMRC had to impose a reduction for each year you were opted out so as not to unfairly penalise those who didn't opt out, and this amount is called your COPE (Contracted Out Pension Equivalent). In my case it amounts to an overall reduction of £42.47 off whatever my full state pension is when I reach retirement age.
The reason that you may or may not have a reduction is that COPE was calculated in 2016 when the pension system was reworked. Every year you work after that date adds 1/35 of your maximum amount back on, which works out at near enough a fiver per week for every year worked up to the maximum state pension amount.
For me, this means that so long as I work for 9 years from 2016 (which I will), I'll get exactly the same maximum state pension that I would've done had I never opted out, and if my opted-out pension pot carries on pulling in the same sort of 5-7% long term growth that it has done to date, then it will have grown to £160k+ of effectively free cash by the time I reach state retirement age.
Again, the same friend of my parents who told me to register for NI contributions suggested that I opt out and set it up for me, so I shall definitely be buying several pints with the proceeds to toast his memory! If you want to, you could double-check my source of information for the above to make sure I've understood it correctly.
Kermit power said:
As I understand it, you may have a reduction, but you won't necessarily have one.
When the change was made, HMRC had to impose a reduction for each year you were opted out so as not to unfairly penalise those who didn't opt out, and this amount is called your COPE (Contracted Out Pension Equivalent). In my case it amounts to an overall reduction of £42.47 off whatever my full state pension is when I reach retirement age.
The reason that you may or may not have a reduction is that COPE was calculated in 2016 when the pension system was reworked. Every year you work after that date adds 1/35 of your maximum amount back on, which works out at near enough a fiver per week for every year worked up to the maximum state pension amount.
For me, this means that so long as I work for 9 years from 2016 (which I will), I'll get exactly the same maximum state pension that I would've done had I never opted out, and if my opted-out pension pot carries on pulling in the same sort of 5-7% long term growth that it has done to date, then it will have grown to £160k+ of effectively free cash by the time I reach state retirement age. Again, the same friend of my parents who told me to register for NI contributions suggested that I opt out and set it up for me, so I shall definitely be buying several pints with the proceeds to toast his memory!
If you want to, you could double-check my source of information for the above to make sure I've understood it correctly.
Apparently you can buy back the COPE years to get a full state pensionWhen the change was made, HMRC had to impose a reduction for each year you were opted out so as not to unfairly penalise those who didn't opt out, and this amount is called your COPE (Contracted Out Pension Equivalent). In my case it amounts to an overall reduction of £42.47 off whatever my full state pension is when I reach retirement age.
The reason that you may or may not have a reduction is that COPE was calculated in 2016 when the pension system was reworked. Every year you work after that date adds 1/35 of your maximum amount back on, which works out at near enough a fiver per week for every year worked up to the maximum state pension amount.
For me, this means that so long as I work for 9 years from 2016 (which I will), I'll get exactly the same maximum state pension that I would've done had I never opted out, and if my opted-out pension pot carries on pulling in the same sort of 5-7% long term growth that it has done to date, then it will have grown to £160k+ of effectively free cash by the time I reach state retirement age.
Again, the same friend of my parents who told me to register for NI contributions suggested that I opt out and set it up for me, so I shall definitely be buying several pints with the proceeds to toast his memory! If you want to, you could double-check my source of information for the above to make sure I've understood it correctly.
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