Jump to content


Photo
- - - - -

Pensioners Release Money Early


  • Please log in to reply
7 replies to this topic

#1 bmf

bmf

    HPC Veteran

  • New Members
  • PipPipPipPip
  • 2,510 posts

Posted 25 February 2012 - 10:44 PM

http://www.bbc.co.uk...siness-17163832

Gotta keep the unsustainable living standard going.

All together now:


Puuuulllllllllllllllll that demand forward.

#2 Bruce Banner

Bruce Banner

    Targ

  • Members
  • PipPipPipPipPipPipPip
  • 13,543 posts

Posted 25 February 2012 - 11:16 PM

They talk about a pension pot of 20K. With a pot that insignificant this is a bit of a non story.
.



----------------------------------------------------------------------------------------------------------
Lest there be any doubt.

No I believe prices will fall and am astounded that a so called Conservative led government could act in such a stupid way. As you can see from today, there are 2,000 HtB applicants and it has been on MSM none stop all day and they make up about 3.5% of a typical months mortgages.

BTL is a good potential way to bankruptcy and yes sometimes I make points to hopefully make people think.


#3 bmf

bmf

    HPC Veteran

  • New Members
  • PipPipPipPip
  • 2,510 posts

Posted 25 February 2012 - 11:19 PM

They talk about a pension pot of 20K. With a pot that insignificant this is a bit of a non story.


That was one example and they didn't indicate this was the average amount.

Here is what they did say:

The Pensions Regulator estimates that by the end of 2011 these schemes had taken 200 million from people trying to free pensions money early.


Not QE numbers but quite a wedge for one year. Certainly not something that sounds sustainable or healthy to me.

#4 Bruce Banner

Bruce Banner

    Targ

  • Members
  • PipPipPipPipPipPipPip
  • 13,543 posts

Posted 25 February 2012 - 11:26 PM

Perhaps it's mostly people in their 30s who are doing this. That would explain the low figure. Cashing in a 20K pot after age 55 would give a tax free lump sum of 5K plus an annuity of about 65 per month.
.



----------------------------------------------------------------------------------------------------------
Lest there be any doubt.

No I believe prices will fall and am astounded that a so called Conservative led government could act in such a stupid way. As you can see from today, there are 2,000 HtB applicants and it has been on MSM none stop all day and they make up about 3.5% of a typical months mortgages.

BTL is a good potential way to bankruptcy and yes sometimes I make points to hopefully make people think.


#5 billybong

billybong

    I live on HPC!

  • Members
  • PipPipPipPipPipPipPip
  • 8,968 posts

Posted 26 February 2012 - 12:03 AM

Those sort of dodgy schemes have been around for getting on at least 20 years now. It's not a new thing.

They were around before NuLabour introduced the 25% tax free lump sum to help fund their boom through consumer spending. Before the 25% was introduced the tax free lump sum was much much less but pensions were far better value - unless you were one of those unfortunate enough to come across one those crooked pension funds - which have become so prevalent, endemic and fraudulent now.

Edited by billybong, 26 February 2012 - 12:17 AM.


#6 RufflesTheGuineaPig

RufflesTheGuineaPig

    is fluffy

  • New Members
  • PipPipPipPipPipPipPip
  • 8,038 posts
  • Location:Cricklade, UK
  • About Me:I am Ruffles, the destroyer of worlds....

Posted 26 February 2012 - 12:54 AM

It probably has a lot to do with pension top-ups etc... unless you have a huge sum of money any cash you have is worthless as you lose out on befits etc.
It's time to pay the piper. There is no magician who will magic away the debt. Someone is going to have to pay it. Bend over and prepare to make payment.

In this glorious nation of ours, if you work hard and keep your head down for 25 years then you too can aspire to own one-eighth of a one bedroom flat in Manchester.


My mum and day always tell me how important it is to save to buy a house. They should know, it took them nearly 6 months to save for theirs. As teenagers, they bought a 3 bed semi.

#7 Squeeky

Squeeky

    HPC Regular

  • Members
  • PipPipPip
  • 311 posts

Posted 26 February 2012 - 08:42 AM

It probably has a lot to do with pension top-ups etc... unless you have a huge sum of money any cash you have is worthless as you lose out on befits etc.


To be honest, getting money out of my pension is something I would consider doing. I'm early thirties so while not ideal, it still isn't to late for me to start a pension from scratch if that is how I would choose to invest money for my retirement.

The reasons for me would be:
- Pension while growing at the moment, isn't growing much.
- Fees are very hidden and I have no control over the damn thing - Yes, I can change the funds etc. but I can't take it all out and stash it under the bed if I choose because the system is about to blow up, and the money is being stolen through greed and corruption....
- Retirement age keeps shifting, I don't think there will be a retirement age realistically for me. By the time I'm 55 it will probably be 100, when I am 100 it'll probably be 140, and the insurance company running my pension will have collapsed leaving me with nothing, so I have to keep working anyway.
- I am saving for a ***** house deposit. If I could just get a third of my pension pot out, that would double my current savings. - okay not brilliant, but It would make borrowing much cheaper.
- If I am going to take out a mortgage, I want to have one as small as possible. It seems nuts to have a wedge sitting somewhere earning around the current mortgage rates and having to borrow more money than necessary because you can't get at it. This also means that your money in the pension pot isn't adding to your net worth as the bank is taking any increases through the mortgage.

I was foolish in my youth and started in the contribution based pensions and struggled on putting a matched 10% (so 20% total) into my pension from the age of 21 when I couldn't really afford it. It sounded like a good deal at the time. Right now, I am not so sure. I just want to get my cost of living down - the pull of having to earn 10 - 12k less a year (after hmrc has had their cut) is quite strong. The only way to do that at the moment is to buy a property outright - assuming you need a roof over your head.

At this rate the extra money I have in a pension is just going to line a LL pocket in my retirement, rather than benefitting me. Unfortunately there is a lot to be said to being mortgage free and having a house. Mortgage along with a house vs renting is quite comparable in my book, so it in't a question of having a house I can claim as my own* that is my main driver, but rather it's a huge bill I would rather avoid having to pay each month.

Anyone have any suggestions? - Yes, a house price crash would be great. But I think another world war is now more probably than significant reduction, say 30% - 50% in housing costs, though I wouldn't rule a world war causing a reduction in housing costs. but anything else? No, I am not buying into a Gold bubble right now.

*as long as you keep up with your repayments

#8 Fatmanfilms

Fatmanfilms

    HPC Poster

  • Members
  • PipPip
  • 105 posts

Posted 26 February 2012 - 08:43 AM

Those sort of dodgy schemes have been around for getting on at least 20 years now. It's not a new thing.

They were around before NuLabour introduced the 25% tax free lump sum to help fund their boom through consumer spending. Before the 25% was introduced the tax free lump sum was much much less but pensions were far better value - unless you were one of those unfortunate enough to come across one those crooked pension funds - which have become so prevalent, endemic and fraudulent now.


Personal Pensions come from 1988 IIRC, the previous retirement annuitiies allowed for approximarely 30% tax free lump sum, so the tax free lump sum was reduced under the Conservitaves.




0 user(s) are reading this topic

0 members, 0 guests, 0 anonymous users