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Working And On Benefits


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#76 Lepista

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Posted 22 February 2012 - 08:06 AM

Is this chap mis-representing how much he's actualloy getting?

Income = 20k
Benefits = 20k, however this is equivalent to something around 30k as a take-home salary

Therefore total income is somewhere nearer 50k, with his disposableincome at something nearer 30k total.

(that's not including the employer contributions, or the empoyer contributions that have been 'missed' by paying benefits...)
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Nothing sedates rationality like large doses of effortless money. After a heady experience of that kind, normally sensible behaviour drift into behaviour akin to that of Cinderella at the ball. They know that overstaying the festivities...will eventually bring on pumpkins and mice. But they nevertheless hate to miss a single minute of what is a helluva party. Therefore, the giddy participants all plan to leave just seconds before midnight. There's a problem, though: They are dancing in a room in which the clocks have no hands."

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#77 silver surfer

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Posted 22 February 2012 - 08:30 AM

Stick your savings in a SIPP or other pension and they don't count as savings for benefits though ( and they'll even add another 20% to it for you).

Obviously you can't then touch it until retirement age.


Correct, but retirement age is 55.

#78 silver surfer

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Posted 22 February 2012 - 08:33 AM

Isn't the benefits system just an acknowledgement of the facts:

1. The cost of living has risen beyond the reach of the average salary.
2. Without large helpings of benefits there would be a lot of poverty and a long hard recession/depression.
3. Benefits are needed to subsidize high house prices. Average wage of 20k doesn't get or pay a mortgage. Add in 20k of benefits=40k=no problem.


Average voters feel entitled to an above average life style and below average voters feel entitled to an average life style.

#79 7 Year Itch

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Posted 22 February 2012 - 08:37 AM

The trouble I have is that its like house prices, the day I decide to play the game is the day this mutha turns and the process of reverting to mean begins in earnest.

There is no ladder.

JY


No need to sell up, the next phase of the economics cycle is going to be very positive for anyone that owns property.

All I'm sayings is, don't listen to the property bears people, they are wrong.


#80 Dorkins

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Posted 22 February 2012 - 08:52 AM

Isn't the benefits system just an acknowledgement of the facts:

1. The cost of living has risen beyond the reach of the average salary.


Yes, but it is bizarre that the best way to access these benefits is to have as many children as possible. Benefits don't seem designed to help poor people on low incomes, they are breeding subsidies accessible to people with plenty of wealth as long as it is in the form of housing equity.

#81 tomandlu

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Posted 22 February 2012 - 10:10 AM

I must admit I'm very puzzled as to the motives of the bbc. Have they deliberately picked examples that highlight the excesses of our benefits system, or is this the best they could come up with in terms of eliciting sympathy? If the former, how does this square with the commonly-expressed opinion on this site that the bbc are a bunch of commies or something?

It's very hard to tell from reading it what the intent is - it's defiantly neutral.
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#82 Tonkers

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Posted 22 February 2012 - 10:31 AM

The trouble I have is that its like house prices, the day I decide to play the game is the day this mutha turns and the process of reverting to mean begins in earnest.

:lol: +1

#83 CrashedOutAndBurned

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Posted 22 February 2012 - 10:58 AM

Isn't the benefits system just an acknowledgement of the facts:

1. The cost of living has risen beyond the reach of the average salary.
2. Without large helpings of benefits there would be a lot of poverty and a long hard recession/depression.
3. Benefits are needed to subsidize high house prices. Average wage of 20k doesn't get or pay a mortgage. Add in 20k of benefits=40k=no problem.


Yep. Don't get the hate for this guy. He's got a disabled kid and works a full-time proper job. A middle of the road white collar worker could have had the same lifestyle on one income without a big benefits package a generation or two ago. The system's wrong, not this father.
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#84 VeryMeanReversion

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Posted 22 February 2012 - 11:16 AM

I've just had a look at working/child tax credit tables. I have two kids so in my case:

Income Handout
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20,000 4,755
25,000 2,705
30,000 655

So the marginal rate is 2000 in benefits lost per 5000 in income gains. (40%)

So with income/NI included, your marginal rate is around 65%.

I'm getting more and more tempted to salary sacrifice even more and more of my salary to get some of this free cash, use the 25% tax-fee amount to clear the mortgage at 55 and retire early.

I always wondered why people on a third of my salary were doing so well.
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#85 opt_out

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Posted 22 February 2012 - 12:20 PM

"Benefits are a good thing, and if society can afford it, they should be paid."

And therein lies the problem.

#86 Dorkins

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Posted 22 February 2012 - 12:34 PM

Wasting almost 6,000 a year on the kiddeee fyddlers organisation (i.e. the church).


It gets better... Presumably the church is a registered charity which is able to claim Gift Aid from the government on its donations. What little income tax Mr Ade pays through his job will end up in the hands of the church anyway.

#87 tomandlu

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Posted 22 February 2012 - 12:46 PM

Yep. Don't get the hate for this guy. He's got a disabled kid and works a full-time proper job. A middle of the road white collar worker could have had the same lifestyle on one income without a big benefits package a generation or two ago. The system's wrong, not this father.


Up to a point I'd agree. However, having enough disposable income to give a fairly hefty chunk to the church and make early payments on his mortgage rather crosses the line...
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#88 opt_out

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Posted 22 February 2012 - 05:25 PM

It's just struck me that if the tax-credit benefits are the same for employed or self-employed, then there will be people out there who get:

20k net earnings after tax
20k benefits
20k cash in hand.

but you won't find them volunteering their story in the newspapers.

this thought may or may not have been influenced by having the plasterer in today.

#89 ingermany

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Posted 22 February 2012 - 05:44 PM

Yep. Don't get the hate for this guy. He's got a disabled kid and works a full-time proper job. A middle of the road white collar worker could have had the same lifestyle on one income without a big benefits package a generation or two ago. The system's wrong, not this father.


Absolutely agree. there is no cause whatsoever to vilify those who are just following the rules that have been drafted by the political establishment. In any case, the real"beneficiaries" are owners of land and property. The benefits keep the property values up by ensuring that families on low incomes can service large mortgages. The money is being siphoned from the young, the single, and those in rented accommodation and being fed to those who have property portfolios. The actual claimants are just blameless intermediaries in the process of theft.

#90 Democorruptcy

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Posted 22 February 2012 - 05:59 PM

Yes, but it is bizarre that the best way to access these benefits is to have as many children as possible. Benefits don't seem designed to help poor people on low incomes, they are breeding subsidies accessible to people with plenty of wealth as long as it is in the form of housing equity.


Breeding potential future taxpayers is rewarded?
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If you say "Democorruptcy" quickly, it sounds a bit like "Democracy". In a "Democracy" people vote for politicians who represent their interests. In the UK's "Democorruptcy" people can only vote for expense fiddling thieving MPs who are in the hip pocket of big business and the finance sector.

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