Pensions Scandal
19 December 2002, 10:36 AM
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was watching TV last night on the pensions scandal....i'll tell you what the scandal is...all the muppets they vox poped in the street said "errr, pension....no not yet, i will soon though" ha ha sod you mug, if people cant be bothered to get of their butt and stick some PROPER money away (dont bother with this £50pm rubbish) then dont moan about working to 110.
this country is full of ppl who expect to just be handed a lifestyle, doesnt matter if its 12 yr old mums expecting housing or £80k pa blokes in the city with no pension at 30- they all need to take some responsibility for their own future!
state pension? who cares...no one on here should, if you can drive a half decent car then you are a mug if you think you will be able to live on the state in the same standard at 65. in fact they should abolish state pension for anyone who paid higher rate tax for a certain number of years cause if those folks didnt save some of it then sod them, the gov could then use the saving to help the truly poor pensioners.
T
this country is full of ppl who expect to just be handed a lifestyle, doesnt matter if its 12 yr old mums expecting housing or £80k pa blokes in the city with no pension at 30- they all need to take some responsibility for their own future!
state pension? who cares...no one on here should, if you can drive a half decent car then you are a mug if you think you will be able to live on the state in the same standard at 65. in fact they should abolish state pension for anyone who paid higher rate tax for a certain number of years cause if those folks didnt save some of it then sod them, the gov could then use the saving to help the truly poor pensioners.
T
19 December 2002, 10:47 AM
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good, as i have support i shall continue!
i used to sell pensions to 20/30 year olds- HARD work, they just do not want to know, even when stock markets where soaring so no excuse there. these where ppl on GOOD money that would pay £500pm for the car £500pm for the HP on the TV and ask if £20pm for the pension was ok!!!!!!
i know only work with older ppl with plenty of money (IHT consultant) and the common theme with all of them? SENSIBLE! very few of my clients have estates of less than £1mill yet i cant think of more than a couple who have cars worth more than £10k, these are ppl who could buy whatever car they wanted! but they'ed rather look ahead and ensure they have enough for the unkown, this was also their view 40 years ago when they started a pension and hence know have nice retirement.
T
i used to sell pensions to 20/30 year olds- HARD work, they just do not want to know, even when stock markets where soaring so no excuse there. these where ppl on GOOD money that would pay £500pm for the car £500pm for the HP on the TV and ask if £20pm for the pension was ok!!!!!!
i know only work with older ppl with plenty of money (IHT consultant) and the common theme with all of them? SENSIBLE! very few of my clients have estates of less than £1mill yet i cant think of more than a couple who have cars worth more than £10k, these are ppl who could buy whatever car they wanted! but they'ed rather look ahead and ensure they have enough for the unkown, this was also their view 40 years ago when they started a pension and hence know have nice retirement.
T
19 December 2002, 10:47 AM
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Erm... what about good honest hard working folk with families and poorer paying jobs who can't afford any more than the "£50 per month rubbish".
Do they get hung out to dry despite having paid for a state pension for 50 years?
Do they get hung out to dry despite having paid for a state pension for 50 years?
19 December 2002, 10:49 AM
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marty, i said "the gov could then use the saving to help the truly poor pensioners."
i am talking about ***** in suits on good money driving good cars and having nice hols who think that £50pm in a pension will get them 2/3rds pay when they retire at 60
i am talking about ***** in suits on good money driving good cars and having nice hols who think that £50pm in a pension will get them 2/3rds pay when they retire at 60
19 December 2002, 10:57 AM
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You've got part of the problem there. The other bit (which might lead to the first bit) is that people don't know how much they need to save. There are loads of people who think that starting to stick fifty quid a month away when they are 35 is going to make everything alright - sorry boys and girls, it won't.
It isn't helped by employers setting up money purchase occupational schemes (or Stakeholder/Personal Pensions) and being generous enough to put 3% of salary in. Yes, its a start but if that's all they're going to pay they really need to be telling their employees that they need to pay a hell of a lot more in themselves.
By the way, did you know that the average size of a fund used to buy an annuity is around £23,000? Index-linked pension for a 60 year old with a 50% widows pension is going to cost around £26 per pound. So that gives an average annuity of £885pa. Happy retirement!
It isn't helped by employers setting up money purchase occupational schemes (or Stakeholder/Personal Pensions) and being generous enough to put 3% of salary in. Yes, its a start but if that's all they're going to pay they really need to be telling their employees that they need to pay a hell of a lot more in themselves.
By the way, did you know that the average size of a fund used to buy an annuity is around £23,000? Index-linked pension for a 60 year old with a 50% widows pension is going to cost around £26 per pound. So that gives an average annuity of £885pa. Happy retirement!
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19 December 2002, 10:58 AM
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To be honest, I've always been wary of pensions because of all the management fees vastly detrimenting the compound growth. This is why I don't have a pension at the moment, but do have long term savings.
I know there are tax breaks for pensions though, so I guess I should sort something out soon (I'm 24). What do you reckon Tiggs?
I know there are tax breaks for pensions though, so I guess I should sort something out soon (I'm 24). What do you reckon Tiggs?
19 December 2002, 11:00 AM
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I've been paying the maximum I'm allowed to into my pension for a few years now. I'm 26.
I figured out years ago that come 2030 or whenever I want to retire, expecting the Government to give me anything was pointless. Have to look after number 1!
I figured out years ago that come 2030 or whenever I want to retire, expecting the Government to give me anything was pointless. Have to look after number 1!
19 December 2002, 11:05 AM
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"I've always been wary of pensions because of all the management fees vastly detrimenting the compound growth."
this is like saying that you stay away from work because the petrol needed to get to the office is detrimental to the salary you earn!
however, its an easy conclusion to reach if you read some of the crap on the subject.
my recomendation is to research and investigate- you dont need an adviser to do this (unless you want to).
your pension SHOULD be the biggest purchase you ever make- mine will be, but ppl spend 100 times longer finding a house or car which will cost less!
this is like saying that you stay away from work because the petrol needed to get to the office is detrimental to the salary you earn!
however, its an easy conclusion to reach if you read some of the crap on the subject.
my recomendation is to research and investigate- you dont need an adviser to do this (unless you want to).
your pension SHOULD be the biggest purchase you ever make- mine will be, but ppl spend 100 times longer finding a house or car which will cost less!
19 December 2002, 11:07 AM
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this is like saying that you stay away from work because the petrol needed to get to the office is detrimental to the salary you earn!
19 December 2002, 11:12 AM
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I guess what I'm asking is what advantages would a pension provide?
only 2 really....
SECURITY FROM YOURSELF, you cant raid it at 35 to pay for an intercooler or some other twaddle that wont seem very important when your 70 with no heat on cause its to expensive.
(im often tempted to say retirement planning not pension as there is no problem with using other types of saving for the same job as your pension- in fact there are benifits to doing this BUT..if its not tied in a pension some ppl WILL raid it.
TAX RELIFE, self explanatory.
T
only 2 really....
SECURITY FROM YOURSELF, you cant raid it at 35 to pay for an intercooler or some other twaddle that wont seem very important when your 70 with no heat on cause its to expensive.
(im often tempted to say retirement planning not pension as there is no problem with using other types of saving for the same job as your pension- in fact there are benifits to doing this BUT..if its not tied in a pension some ppl WILL raid it.
TAX RELIFE, self explanatory.
T
19 December 2002, 11:12 AM
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I got my first pension when I was about 19. My uncle was in the trade, so he kind of looked after us in that respect. I now also have a second pension (for the last few yesrs) with the company also contributing. I've also some small funds "locked" into Equitable Life 
I think I need to see an adviser again though to see how much they need topping up by..
Ninbus (35)
I think I need to see an adviser again though to see how much they need topping up by..
Ninbus (35)
19 December 2002, 11:18 AM
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Some advantages:
Contributions into a pension (subject to limits which vary depending on the type of pension - well they do at the moment) get tax relief at your marginal rate. So a higher rate tax payer is only going to "spend" £60 to get £100 invested. The pension fund is exempt from CGT and tax on income (apart from on share dividends - thanks Mr Brown). When you retire you can take 25% of the fund (assuming it's a personal pension) as cash which is tax free. If you die before then the fund can be paid as a lump sum which wouldn't be part of your estate for Inheritance Tax purposes.
Oh, and if you become bankrupt, your trustee in bankruptcy can't get his hands on your pension fund
Contributions into a pension (subject to limits which vary depending on the type of pension - well they do at the moment) get tax relief at your marginal rate. So a higher rate tax payer is only going to "spend" £60 to get £100 invested. The pension fund is exempt from CGT and tax on income (apart from on share dividends - thanks Mr Brown). When you retire you can take 25% of the fund (assuming it's a personal pension) as cash which is tax free. If you die before then the fund can be paid as a lump sum which wouldn't be part of your estate for Inheritance Tax purposes.
Oh, and if you become bankrupt, your trustee in bankruptcy can't get his hands on your pension fund
19 December 2002, 11:23 AM
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So if I was earning, say, £1 over the limit for higher rate tax, I would get 40% tax relief on all of my pension payments?
OK, I'll be the first to admit it. I'm 29, earn decent money, and don't have a pension. I will sort it out after moving house next month...
OK, I'll be the first to admit it. I'm 29, earn decent money, and don't have a pension. I will sort it out after moving house next month...
19 December 2002, 11:23 AM
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just to shatter a myth while im here!
you wont make your IFA a rich man by doing a pension any more so dont worry to much about charges, personally i wouldnt even get involved in a pension case unless the client was talking about £500pm + MINIMUM.
this is not a "ohh, feel sorry for me" statment, just thought i'd get in before someone dives in with the "EVIL IFA" bit!
you wont make your IFA a rich man by doing a pension any more so dont worry to much about charges, personally i wouldnt even get involved in a pension case unless the client was talking about £500pm + MINIMUM.
this is not a "ohh, feel sorry for me" statment, just thought i'd get in before someone dives in with the "EVIL IFA" bit!
19 December 2002, 11:25 AM
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So if I was earning, say, £1 over the limit for higher rate tax, I would get 40% tax relief on all of my pension payments?
19 December 2002, 11:40 AM
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It was worth a try 
I'm an IT contractor, so in essence I can pay myself whatever I like as salary (as long as the company has funds to stand it, obviously ). Not too sure about whether it's better to set up a company pension or a personal one, as there's tax relief on the payments if I make them personally anyway (but not NI relief, AFAIK, and NI is a double whammy when you're a company director). If it's the same for both, then it's easier to do a personal pension to save having to **** around on the P11D form, I guess.
I got an illustration for a Stakeholder last year, and the annoying thing was that the fund management charges came out of the overall funds (i.e. with growth) rather than out of the payments [img]images/smilies/mad.gif[/img]
I'm an IT contractor, so in essence I can pay myself whatever I like as salary (as long as the company has funds to stand it, obviously
). Not too sure about whether it's better to set up a company pension or a personal one, as there's tax relief on the payments if I make them personally anyway (but not NI relief, AFAIK, and NI is a double whammy when you're a company director). If it's the same for both, then it's easier to do a personal pension to save having to **** around on the P11D form, I guess.I got an illustration for a Stakeholder last year, and the annoying thing was that the fund management charges came out of the overall funds (i.e. with growth) rather than out of the payments [img]images/smilies/mad.gif[/img]
19 December 2002, 11:53 AM
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carl,
if your payments grow to a huge amount under their control you have to allow them to charge based on what they have to deal with.
any director needs to explore it properly to weigh up the advantage of pay V tax relife V pension, or look at whether a traditional pension is the best anyway.
not my field but my partner does corporate advice so if you want to drop me a mail in the future feel free, i'll pass it on.
T
if your payments grow to a huge amount under their control you have to allow them to charge based on what they have to deal with.
any director needs to explore it properly to weigh up the advantage of pay V tax relife V pension, or look at whether a traditional pension is the best anyway.
not my field but my partner does corporate advice so if you want to drop me a mail in the future feel free, i'll pass it on.
T
19 December 2002, 11:57 AM
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Will do. As I said, I'm moving house on Jan 6th so after that (when I work out exactly how much I've left to live on with a huge mortgage ) I'll be looking to sort something out.
) I'll be looking to sort something out.
19 December 2002, 11:58 AM
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i used to sell pensions to 20/30 year olds- HARD work, they just do not want to know, even when stock markets where soaring so no excuse there.
personally I think the whole pensions thing is a time bomb waiting to off, a pensions adviser told me years ago that property is the best investment and I would have to agree, I dont have one and I dont agree with them IMHO.
Gary
19 December 2002, 12:04 PM
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""my argument was always but i wanna pi$$ it up the wall now while i've got my health, i might not see 50 or enjoy life past it! "
and plan B if you make 51 is what?
"personally I think the whole pensions thing is a time bomb waiting to off"
it is, because ppl pi$$ their money up the wall and dont save it
"I dont have one and I dont agree with them IMHO."
oddly my clients living (past 50 belive it or not) would not agree!
good luck!
and plan B if you make 51 is what?
"personally I think the whole pensions thing is a time bomb waiting to off"
it is, because ppl pi$$ their money up the wall and dont save it
"I dont have one and I dont agree with them IMHO."
oddly my clients living (past 50 belive it or not) would not agree!
good luck!
19 December 2002, 12:06 PM
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What incentive is there to hand over a significant amount of income with no real guarantees of return, no control over the investment and very little flexibility?
I'm 29 and as far as I'm concerned I have put a minumum amount into my company pension since I was 26 (around 120 quid a month).
Although I'm in a position to pay 500 - 800 a month I'm far happier controlling my own investments that leaving it to some cokehead fund manager in the City.
My aim (and I'm not the only one I know who is going down this route) is to make my own plans for retirement and spread my investments over a number of areas.
I've recently bought and restored 250,000 quid flat in Amsterdam (no cash deposit needed and 55% tax relief on interest whilst I live here) which I'm planning on keeping very long term as part of my 'pension' - rent out when I leave the country - the only reason for selling up would be to invest back into property. I'm also about to set up an offshore low-risk savings plan to put 600 a month away.
Seems to me that I'm doing OK to ensure a reasonable retirement -= any experts care to comment?
cheers
Ian
I'm 29 and as far as I'm concerned I have put a minumum amount into my company pension since I was 26 (around 120 quid a month).
Although I'm in a position to pay 500 - 800 a month I'm far happier controlling my own investments that leaving it to some cokehead fund manager in the City.
My aim (and I'm not the only one I know who is going down this route) is to make my own plans for retirement and spread my investments over a number of areas.
I've recently bought and restored 250,000 quid flat in Amsterdam (no cash deposit needed and 55% tax relief on interest whilst I live here) which I'm planning on keeping very long term as part of my 'pension' - rent out when I leave the country - the only reason for selling up would be to invest back into property. I'm also about to set up an offshore low-risk savings plan to put 600 a month away.
Seems to me that I'm doing OK to ensure a reasonable retirement -= any experts care to comment?
cheers
Ian
19 December 2002, 12:06 PM
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yep each to their own tiggs, the apartment me and my girlfriend bought in marbella for 80K is now worth 110K (in 2 years), if i got that sort of return off a pension I might be tempted....
of course and if I make 51 wonder how much it'll be worth then!
of course and if I make 51 wonder how much it'll be worth then!
19 December 2002, 12:15 PM
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ian,
no problem with ppl doing their own thing if they are up to it but saying things like "leaving it to some cokehead fund manager in the City" is stupid. i know loads of fund managers and none of them are coke heads! comments like yours are what puts ppl off investing who dont then have the ability/know how to go off and buy European propeties at the drop of a hat!
T
ps- £80- £110k?, i have done plent of huge pensions for directors with massive tax relife, i have also sorted SIPP funds for people to buy property so they get the growth tax free and i have seen funds move 30-40%pa in med risk sectors, .......just cause houses are the "sexy thing" right now doesnt mean they are the only tool in the box
no problem with ppl doing their own thing if they are up to it but saying things like "leaving it to some cokehead fund manager in the City" is stupid. i know loads of fund managers and none of them are coke heads! comments like yours are what puts ppl off investing who dont then have the ability/know how to go off and buy European propeties at the drop of a hat!
T
ps- £80- £110k?, i have done plent of huge pensions for directors with massive tax relife, i have also sorted SIPP funds for people to buy property so they get the growth tax free and i have seen funds move 30-40%pa in med risk sectors, .......just cause houses are the "sexy thing" right now doesnt mean they are the only tool in the box
19 December 2002, 12:45 PM
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I'm no expert in these things, but AFAIK you could put yer whole salary in to a pension and still be pretty badly off come retirement.
I'm lucky in that my company pays the equivalent of 10% of my gross salary into a pension fund of my choice. Never-the-less I made the decision that the pension would be "pocket money" for when I retire, and have invested in residental and commercial property (buy-to-lets), and also investing in medium risk business ventures..
I'm lucky in that my company pays the equivalent of 10% of my gross salary into a pension fund of my choice. Never-the-less I made the decision that the pension would be "pocket money" for when I retire, and have invested in residental and commercial property (buy-to-lets), and also investing in medium risk business ventures..
19 December 2002, 12:47 PM
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hm interesting post Tiggs..
Im still holding out after I rejected the company stakeholder one; huge charges. (CIS)
I am a higher rate tax payer now, BUT I have so little money left at the end of the month (single income family) that any pension has got to be water tight and worth it.. so far I havent found any that fit the criteria..
I was also looking at eventually buying property and off shore interests.. but as you say its sucha minefield..
It seems the wiser option, but as my income is 99% of the time spoken for, then 1% more money than I know what to do with its all a big headache happening...
C
(25)
Im still holding out after I rejected the company stakeholder one; huge charges. (CIS)
I am a higher rate tax payer now, BUT I have so little money left at the end of the month (single income family) that any pension has got to be water tight and worth it.. so far I havent found any that fit the criteria..
I was also looking at eventually buying property and off shore interests.. but as you say its sucha minefield..
It seems the wiser option, but as my income is 99% of the time spoken for, then 1% more money than I know what to do with its all a big headache happening...
C
(25)
19 December 2002, 01:55 PM
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"I'm no expert in these things, but AFAIK you could put yer whole salary in to a pension and still be pretty badly off come retirement."
i assume you are kidding? noe expert maybe but my 5 year old can do better maths than that!
i assume you are kidding? noe expert maybe but my 5 year old can do better maths than that!