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Just Got My Pension Plan Update

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Target asset allocation March 2010 is 65% bonds, 34.6% equities & 0.4% property

It seems like they don't believe house prices only go up.

My favourite bit is about QE creating a low interest environment BUT "The trustees agreed that the valuation would include a one off adjustment to the forecast return to recognise the potential for rates to recover".

Sweep it all under the carpet!

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Target asset allocation March 2010 is 65% bonds, 34.6% equities & 0.4% property

It seems like they don't believe house prices only go up.

My favourite bit is about QE creating a low interest environment BUT "The trustees agreed that the valuation would include a one off adjustment to the forecast return to recognise the potential for rates to recover".

Sweep it all under the carpet!

1. How old are you?

2. Can you choose what funds you invest your pension in?

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Christ, sitting on a powder keg or what?

Firstly, with the bulk in bonds and bond yields at record lows and the remainder in equities, that in real money terms are actually declining in value, how on earth is this portfolio returning an income?

I'll tell you. Ponzi economics. All the cash from the new entrants is flowing out to meet payments for the current pensioners. All being even, don't expect anything to be left when it's your turn.

However, I doubt things will all stay even. We are in a massive bond bubble which is about to burst and chances are the nominal value (for that's all it is) of the stock market is due to take another kicking too.

Prepare to kiss goodbye to your pension, it's supposed value is going to collapse.

I should also add that last week David Cameron proposed to make it obligatory for all private companies to make sure their employees were part of a private pension scheme. At first glance this appears a sensible move. However, this is just an underhand way of getting private pension funds to loan more of your hard-earned money to the govt., as UK pension funds are forced (along with banks, life assurance companies and other institutions) to hold UK gilts for a portion of their portfolios.

They want your money to meet their obligations today, not to pay for your retirement!!!

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Talking to a senior guy in my pension dept he informed me that they are funded at around 60% its been dropping around 3% a year lately ,they also invest in bonds more than equity's, but the major cloud is having to pay existing pensioners 5% a year increase, if inflation carries on like this they will be in serious trouble within in a few years.

I would imagine this goes for most blue chip pension schemes

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Talking to a senior guy in my pension dept he informed me that they are funded at around 60% its been dropping around 3% a year lately ,they also invest in bonds more than equity's, but the major cloud is having to pay existing pensioners 5% a year increase, if inflation carries on like this they will be in serious trouble within in a few years.

I would imagine this goes for most blue chip pension schemes

When you say funded at around 60% I assume you mean they currently have 60% of the capital required to meet their future obligations? That's a lot of ground to be made up. How is it going to be made up?

You are entirely right about the 5% a year increase. Even with all things staying equal, with bond yields as low as they are and inflation remaining stubbornly above target, they're going to have to keep on eating into that 60% to fund current pensioners incomes. And if bond prices collapse, yields might go up, but the capital base of the pension funds is going to shrink even more drastically.

This will not end well for many, they are simply unwittingly giving their money away for others to enjoy for free.

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1. How old are you?

2. Can you choose what funds you invest your pension in?

Nearly 50. It's a deferred pension from a place I worked between 1984 and 1994. I don't think I can choose the funds.

They say all major markets returned 30% annually from March 2009. Their investments returned 25% which contrasts well with the -12.8% the year before.

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Nearly 50. It's a deferred pension from a place I worked between 1984 and 1994. I don't think I can choose the funds.

They say all major markets returned 30% annually from March 2009. Their investments returned 25% which contrasts well with the -12.8% the year before.

Did they take account of the devaluation in sterling into those figures?

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When you say funded at around 60% I assume you mean they currently have 60% of the capital required to meet their future obligations? That's a lot of ground to be made up. How is it going to be made up?

You are entirely right about the 5% a year increase. Even with all things staying equal, with bond yields as low as they are and inflation remaining stubbornly above target, they're going to have to keep on eating into that 60% to fund current pensioners incomes. And if bond prices collapse, yields might go up, but the capital base of the pension funds is going to shrink even more drastically.

This will not end well for many, they are simply unwittingly giving their money away for others to enjoy for free.

Yes that's correct , wonder what the UK average funding is re future obligations

Massive time bomb IMO

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...We are in a massive bond bubble which is about to burst...

I went for lunch with a bloke I know from student days who these days works for the vampire squid, he was of much the same view, which I found a bit odd because, well, it's not a new idea or anything but this is a chap who was very much in denial about the dotcomm bubble and, until about 2006 or something, the pwoperdee bubble.

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Did they take account of the devaluation in sterling into those figures?

I doubt that very much.

Strange but before this report I cannot remember seeing such a detailed section on "What happens if the Company is unable to meet its commitment to the Plan", with a lot of info about how about the Pension Protection Fund works.

Anyway I'm sure I have nothing to worry about with them being in such a growth sector:

Mitchells and Butlers "The UK's leading operator of managed pubs"

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I doubt that very much.

Strange but before this report I cannot remember seeing such a detailed section on "What happens if the Company is unable to meet its commitment to the Plan", with a lot of info about how about the Pension Protection Fund works.

Anyway I'm sure I have nothing to worry about with them being in such a growth sector:

Mitchells and Butlers "The UK's leading operator of managed pubs"

Rather be in Housing :lol:

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Firstly, with the bulk in bonds and bond yields at record lows and the remainder in equities, that in real money terms are actually declining in value, how on earth is this portfolio returning an income?

I should hope 60% in bonds doesn't imply 60% in gilts. Not the same thing!

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I went for lunch with a bloke I know from student days who these days works for the vampire squid, he was of much the same view, which I found a bit odd because, well, it's not a new idea or anything but this is a chap who was very much in denial about the dotcomm bubble and, until about 2006 or something, the pwoperdee bubble.

Vampire squid?? :huh:

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  • 239 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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