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Retirement? Nah.

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http://news.bbc.co.uk/1/hi/programmes/newsnight/8973814.stm

Nearly three quarters of people believe retirement as we currently understand it will not be possible in the future, a BBC Newsnight poll has suggested.

Some 70% of the 1,000 asked thought it would not be feasible for people to stop work then live on a pension for up to 30 years, the ComRes survey found.

Some 72% of those in work were also worried about not having the funds to live as they would like in retirement.

More than three quarters (77%) thought younger people would get a worse deal.

And more than half (54%) thought it was unfair that younger generations would be worse off than those currently approaching retirement age.

"Whereas it used to be the case that up and coming generations tended to be more prosperous then their parents, now we're going to be in reverse"

Historian Jeremy Black

What will the longer term ramifications of this be? Will people simply spend everything they earn, expecting to work until they drop? Will more people start opting out of "the system" and into black market activities?

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There is a common claim, which is that over the next 20-30 years the average person born in about 1975-2005 will work long hours, for low real wages, in two income households, paying 40-50% of their take home on housing, sending large amounts of tax money to the state, and meanwhile the average person born 1945-1965 will retire in their 60s to live a life of healthful leisure funded by final salary company or public sector pensions, generous state pensions and property and stockmarket investments.

If things carried on as they are then yes, this is what would happen. But I don't think it's possible for things to carry on as they are, as the system just has too many internal contradictions:

1. How are companies going to make enough profit to pay into their pension pots what they have promised to pay out when working people are struggling to make ends meet and cutting back on discretionary spending?

2. How are retirees going to cash out their share/property portfolios at their expected value when the next generation is only just making enough to get by, let alone invest large sums for the future by buying those shares or properties off them?

3. How can the government extract enough tax from working people to fund its state and public sector pension promises (not to mention bailing out bank bond- and shareholders from their bad investments and servicing the national debt which is mostly owned by pension funds) without creating riots, tax evasion en masse, and even bigger disincentives to work than we already have?

The financial system is already collapsing because the young can't afford to pay for what the older generation has been promised, and that tendency is only going to increase as more and more of those promises come due and the ability to pay gets worse. In real terms it doesn't matter how much they print or how much government debt they take onto the books, those promises will have to be broken by default or by inflation. The circle will be squared by reducing transfers to the older population to a sustainable level, and that process will involve some combination of house/share price crashes, real cuts to state and public sector pensions, inflation, bond market collapse, and so on. My guess is that by the time today's young are old, the level of transfers to the older population will be at a sustainable level and they will be able to retire just fine.

Edited by Dorkins

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There is a common claim, which is that over the next 20-30 years the average person born in about 1975-2005 will work long hours, for low real wages, in two income households, paying 40-50% of their take home on housing, sending large amounts of tax money to the state, and meanwhile the average person born 1945-1965 will retire in their 60s to live a life of healthful leisure funded by final salary company or public sector pensions, generous state pensions and property and stockmarket investments.

If things carried on as they are then yes, this is what would happen. But I don't think it's possible for things to carry on as they are, as the system just has too many internal contradictions:

1. How are companies going to make enough profit to pay into their pension pots what they have promised to pay out when working people are struggling to make ends meet and cutting back on discretionary spending?

2. How are retirees going to cash out their share/property portfolios at their expected value when the next generation is only just making enough to get by, let alone invest large sums for the future by buying those shares or properties off them?

3. How can the government extract enough tax from working people to fund its state and public sector pension promises (not to mention bailing out bank bond- and shareholders from their bad investments and servicing the national debt which is mostly owned by pension funds) without creating riots, tax evasion en masse, and even bigger disincentives to work than we already have?

The financial system is already collapsing because the young can't afford to pay for what the older generation has been promised, and that tendency is only going to increase as more and more of those promises come due and the ability to pay gets worse. In real terms it doesn't matter how much they print or how much government debt they take onto the books, those promises will have to be broken by default or by inflation. The circle will be squared by reducing transfers to the older population to a sustainable level, and that process will involve some combination of house/share price crashes, real cuts to state and public sector pensions, inflation, bond market collapse, and so on. My guess is that by the time today's young are old, the level of transfers to the older population will be at a sustainable level and they will be able to retire just fine.

Just changing the retirement age - or making it flexible - should be enough.

So if you really want you can retire at 60 - just so long as you don't mind a miniscule state pension. (real terms)

Or wait all the way to 75, and get a much higher pension, for not as long, obviously.

We just cannot have company linked final salary based schemes, especially for people retiring at 60. But they only ever worked when people only lived to 67.. We probably could afford them now if people worked to 77.

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My issue with all of this is that we might be living till we're 85-90, but can we really work hard into 70s? I look at my parents who are in their late 60s and I shudder at the thought of having to work at their age, which is almost certain the way things currently are. In the UK we have an odd boom generation. North America was about 10 years earlier than us...for me it makes sense to go there as here I am in the middle of the boom and there is no chance I will be able to retire at the same time a a gazillion others in the UK. All very depressing really...then add in Peak Oil etc...I say spend all your dough while you can, and while it buys you decent stuff and let tomorrow take of itself!!!

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1. How are companies going to make enough profit to pay into their pension pots what they have promised to pay out when working people are struggling to make ends meet and cutting back on discretionary spending?

They'll go Japan and work them harder and harder where 120 hour weeks are normal, of course people will only be paid for 36hours or less. The companies will also close the schemes to the new entrants giving them big promises which will be used as a ponzi scheme so that the people paying in now in 30 years time get paid nominal amounts where inflation has raped the value so the pension will not buy a 1p(F£ future revalued pound) sweet

2. How are retirees going to cash out their share/property portfolios at their expected value when the next generation is only just making enough to get by, let alone invest large sums for the future by buying those shares or properties off them?

They will restrict supply and become landlords instead, so while now some landlords are lording over it by cutting houses into many flats you can reverse this so that each house holds less people meaning an effective supply restriction. Labour just before they got the boot introduced a law whereby you need a licence (read tax) if more than 2 unrelated people live together. Such licences will be harsher in the future where they are simply not given out. HK Dai Pai shops are legal with licences, problem is the government hasn't issued them since 1982.

3. How can the government extract enough tax from working people to fund its state and public sector pension promises (not to mention bailing out bank bond- and shareholders from their bad investments and servicing the national debt which is mostly owned by pension funds) without creating riots, tax evasion en masse, and even bigger disincentives to work than we already have?

The costs of oppression are falling, while Injin rants on about having to have soldiers come round to demand your stuff, automation is coming to the modern day fiat system. So you refuse to pay your tax? A remote computer controlled drone will come to your house and bomb it. Current CCTV cameras will be converted to autoguns (with lasers so no ammo is needed) so when people protest you simply shoot them to make an example of them. Since you control the mass media you can say they were kiddy fiddlers and or terrorists and shoot these people too.

Advanced propaganda currently works fine today, there are still 1000000s of people who say De Menzes was a rapist and had a bomb jacket. There are more people who say those Muslims who were said to have bombs (where the cops found nothing and the news said they were kiddy fiddlers) still believe they are guilty. Etc...

School curiculum will be changed to even more brainwashing, and the language will be altered so people cannot even conceptualise revolution and revolt.

The financial system is already collapsing because the young can't afford to pay for what the older generation has been promised, and that tendency is only going to increase as more and more of those promises come due and the ability to pay gets worse. In real terms it doesn't matter how much they print or how much government debt they take onto the books, those promises will have to be broken by default or by inflation. The circle will be squared by reducing transfers to the older population to a sustainable level, and that process will involve some combination of house/share price crashes, real cuts to state and public sector pensions, inflation, bond market collapse, and so on. My guess is that by the time today's young are old, the level of transfers to the older population will be at a sustainable level and they will be able to retire just fine.

Printing maybe or as above shooting people every so often to make an example of them.

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News Night on soon sounds depressing we will never retire!!

Of course you won't bl00dy retire, your'e too busy accepting the dogma that is destroying everything working people have fought for whilst bankers and city boys keep stuffing theirt pockets at your expense.

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unfortunately no-one who needs to see this stuff actually watches newsnight. none of the 1965-born entitles-ones who take too many holidays and want higher taxes on the young to let them retire, will watch this

Edited by Si1

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I'm waiting to hear that old chestnut "I've paid in all my life, where's my money." :rolleyes:

hutton will say 'baby - boomers.'

Bingo!

Edited by deflation

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I'm waiting to hear that old chestnut "I've paid in all my life, where's my money." rolleyes.gif

54 y.o. engineer just said it

bet he loves the value of his house tho

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54 y.o. engineer just said it

bet he loves the value of his house tho

I think he sais 58. And if he has been an engineer for years, why on earth is he relying on the state pension? It's pennies compared to any firm pension he has, unless he's p*ssed it all away.

He should be able to retire 12 months early and not collect his £100 a week. If he's relying on it so heavily, he's going to be in penury anyway.

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I think he sais 58. And if he has been an engineer for years, why on earth is he relying on the state pension? It's pennies compared to any firm pension he has, unless he's p*ssed it all away.

He should be able to retire 12 months early and not collect his £100 a week. If he's relying on it so heavily, he's going to be in penury anyway.

he is likely a perfectly decent chap, and it is true to say that private pensions for his generation were abysmal unless he got a final sal, it is only since mid 1990s that decent low cost private pension funds have been available

Edited by Si1

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the types who have retired early with a nice sailing boat get on my wick I know people who retired mid 50's and expect free bus passes and everything for nothing not paid taxes for years

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the types who have retired early with a nice sailing boat get on my wick I know people who retired mid 50's and expect free bus passes and everything for nothing not paid taxes for years

They might not be paying income tax's , but they are paying tax's in other ways . I bet if worked out my Dad pays more in tax than he recieves form the state pension.

Besides there are millions of working age not paying income tax's.

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Ive never understood the 'waste all your good healthy years doing stuff you hate in order to spend your least healthy years doing bugger all and waiting for death' idea anyway. Do people really want that? Don't wait till your 65+ to see the pyramids, swim with dolphins and take up that hobby you've always fancied, do it all now. What's stopping you? Whose to say you're even going to live to see your retirement anyway? You want to be hiking around the lake district with dodgy knees and an inability to cope with a cold wind? You really want to go on that motorbike trip across the states when you don't have the strength to get on a bike?

I can't believe people think its a good idea. Be part retired your whole life. Spend some time working, spend some time off doing what you want. There's no 'career' now anyway, any loyalty to a company isn't going to be rewarded, let's face it the place will go bust before your ID card photo looks out of date, just jump from job to job and place to place and live NOW.

Having the majority of your small lifetimes free time right at the end when in the poorest health you will ever have is absolutely ridiculous. Working and then retiring is a stupid idea, it's like the company says to people 'use up your life here making me rich and I promise you'll have a pot of gold at the end of it, and you can do whatever you want! It will be fine I promise!'.

And everyone falls for it and thinks thats a great idea.

"Break your back for me and you'll have everything you ever wanted... that's it... keep coming into work.... pay those taxes.... get deeper into debt..... Oh! children! Excellent, more tax payers.... that's right send them to school so they can do what you did.... tell them what you are doing is what they should do.... that it is 'moral'..... work will set you free....."

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Ive never understood the 'waste all your good healthy years doing stuff you hate in order to spend your least healthy years doing bugger all and waiting for death' idea anyway. Do people really want that? Don't wait till your 65+ to see the pyramids, swim with dolphins and take up that hobby you've always fancied, do it all now. What's stopping you? Whose to say you're even going to live to see your retirement anyway? You want to be hiking around the lake district with dodgy knees and an inability to cope with a cold wind? You really want to go on that motorbike trip across the states when you don't have the strength to get on a bike?

I can't believe people think its a good idea. Be part retired your whole life. Spend some time working, spend some time off doing what you want. There's no 'career' now anyway, any loyalty to a company isn't going to be rewarded, let's face it the place will go bust before your ID card photo looks out of date, just jump from job to job and place to place and live NOW.

Having the majority of your small lifetimes free time right at the end when in the poorest health you will ever have is absolutely ridiculous. Working and then retiring is a stupid idea, it's like the company says to people 'use up your life here making me rich and I promise you'll have a pot of gold at the end of it, and you can do whatever you want! It will be fine I promise!'.

And everyone falls for it and thinks thats a great idea.

"Break your back for me and you'll have everything you ever wanted... that's it... keep coming into work.... pay those taxes.... get deeper into debt..... Oh! children! Excellent, more tax payers.... that's right send them to school so they can do what you did.... tell them what you are doing is what they should do.... that it is 'moral'..... work will set you free....."

I think the answer is money or rather lack of it when they are younger .

Edited by miko

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An eloquent rant, and I agree. Been working part-time myself for years.

BUT, don't forget pensions are a recent invention for the masses. It was 'work til you' die before that, or put money away (if you could)or get your kids to keep you. State pensions are enforced-savings in a way.

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Ive never understood the 'waste all your good healthy years doing stuff you hate in order to spend your least healthy years doing bugger all and waiting for death' idea anyway. Do people really want that? Don't wait till your 65+ to see the pyramids, swim with dolphins and take up that hobby you've always fancied, do it all now. What's stopping you? Whose to say you're even going to live to see your retirement anyway? You want to be hiking around the lake district with dodgy knees and an inability to cope with a cold wind? You really want to go on that motorbike trip across the states when you don't have the strength to get on a bike?

I can't believe people think its a good idea. Be part retired your whole life. Spend some time working, spend some time off doing what you want. There's no 'career' now anyway, any loyalty to a company isn't going to be rewarded, let's face it the place will go bust before your ID card photo looks out of date, just jump from job to job and place to place and live NOW.

Having the majority of your small lifetimes free time right at the end when in the poorest health you will ever have is absolutely ridiculous. Working and then retiring is a stupid idea, it's like the company says to people 'use up your life here making me rich and I promise you'll have a pot of gold at the end of it, and you can do whatever you want! It will be fine I promise!'.

And everyone falls for it and thinks thats a great idea.

"Break your back for me and you'll have everything you ever wanted... that's it... keep coming into work.... pay those taxes.... get deeper into debt..... Oh! children! Excellent, more tax payers.... that's right send them to school so they can do what you did.... tell them what you are doing is what they should do.... that it is 'moral'..... work will set you free....."

+1

Why is it that people accept the lie that funding a decent retirement can only be achieved through the contributions of working people. Do they really believe that only wealth created through pension contributions can allow older people to get off the treadmill?

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I've just watched the pensions piece on Newsnight and I can't believe that, apart from the odd mention of housing costs from the 29 year old author, house prices did not get a mention.

Today young people are expected to pay for their higher education, pay taxes to fund the state pension and healthcare for longer living population and pay high house prices so old people can sell up when they retire and put a few hundred grand borrowed by people younger than them in the bank for their retirement.

Something has to give. It strikes me older people can either get high house prices and no pension - or a pension and much, much lower house prices.

Young people cannot afford to pay for all of it. It's just that simple.

Sooner or later, reality will dawn.

The other thing that didn't get a mention was public sector pensions. There was plenty about the retirement age going up from 65 - be a bloody good start if public sector workers didn't get their pension until they were 65.

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The other thing that didn't get a mention was public sector pensions. There was plenty about the retirement age going up from 65 - be a bloody good start if public sector workers didn't get their pension until they were 65.

That's the rub , the big one , the last pile of **** govenment did not have the guts to do anything about public sector pensions and time will tell if this lot have the guts.

Public sector pensions is the one that is really bleeding the system dry , but they pick on the state pension easier option.

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Ive never understood the 'waste all your good healthy years doing stuff you hate in order to spend your least healthy years doing bugger all and waiting for death' idea anyway. Do people really want that? Don't wait till your 65+ to see the pyramids, swim with dolphins and take up that hobby you've always fancied, do it all now. What's stopping you? Whose to say you're even going to live to see your retirement anyway? .......

"Break your back for me and you'll have everything you ever wanted... that's it... keep coming into work.... pay those taxes.... get deeper into debt..... Oh! children! Excellent, more tax payers.... that's right send them to school so they can do what you did.... tell them what you are doing is what they should do.... that it is 'moral'..... work will set you free....."

One of the more insightful posts amid the anti boomer hatefest.

I knew 2 guys who died in their 50s of lung cancer (smokers both) who went on a 'what to do before I die' ticklist spree. But their health was v poor and their time desperately short. They really wished they'd got off the corporate treadmill before the cancer got them, and got themselves a better work/life balance. Early death could happen to anyone, I also knew a classmate who died when he was 19 in a motorcycle crash.

It's great if your job is your passion or hobby, but for the rest arbeit does not macht frei.

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