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Number Of People Paying Into A Pension Hits 60-Year Low

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Telegraph

'"Not only is the number of people in workplace pension schemes at its lowest level in 60 years, but recent research from Scottish Widows found that expectations for income in retirement are still increasing. To meet these aspirations, a 30 year old saver would need to save £12,000 a year, or £1,000 per month every year until retirement."

Job figures last month revealed that a record one million over 65s were now in work, with analysts blaming the need for many to earn extra money. '

ONS

Public sector employment at 5.697 million in Q1 2013

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Only worth paying into a pension if:

The system hasn't collapsed before you come to draw it.

The city doesn't get round to stealing it from you.

The government doesn't just take it.

and

You can put over £500,000 into it.

Otherwise you would be better buying lottery tickets and hoping for a payoff. You'd get less than someone on benefits otherwise.

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Annaraccoon has a good article about this today.

http://www.annaraccoon.com/politics/cracked-nest-egg-syndrome/#comments

Long ago, Equitable Life had a canny scheme. ‘Give us your money now, and we’ll give it back to you with a bit extra when you are older’. And lo! many wealthy people with money to spare did just that. It’s a long and complicated story that I shan’t rehash now, but 30 years later, people found that lo! the money wasn’t there, not the bit extra, not even the money they’d saved up in the first place. They’d been had as surely as any bent Christmas club – no turkey on the table for them.

‘Blimey, that’s a good idea’, said Cap’n Bob Maxwell. ‘Give us your money now, and we’ll give it back to you with a bit extra when you are older’. He didn’t of course. It was no longer there, spirited away whilst they were unable to look. No Turkey on the table for them.

‘Sheer Genius’! cried Cap’n Gordon, ‘now I’m in charge of the leaky vessel, I’ll try me hand at this scam’. ‘Heave Ho, me hearties, lets be ‘avin your pension savings’ And he did.

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It's always worth reminding ourselves that Brown was not the only Raider of the Pension Ark. Norman Lamont cut tax relief for dividends to pension funds, and the policy is widely attributed to one of his young advisors, a certain D. Cameron.

No government has a good record on the care of long-term asset management. Cameron can be safe in the knowledge that he has made his own contribution to the current mess.

I'm in my thirties and there is no way whatsoever that I'll pay into a formal pension scheme if avoidable.

Edited by cheeznbreed

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Whats the point, when the government will only seize it anyway, and give it to a bunch of self entitled civil servants?

May as well just save in gold. Aint gonna get a yield, but its more difficult for the statists to detect and seize.

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Pensions have got to be the ultimate ponzi scheme. Why would you ever give your own money to someone else to look after in the hope you might get some back. These companies are not charities.

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Pensions have got to be the ultimate ponzi scheme. Why would you ever give your own money to someone else to look after in the hope you might get some back. These companies are not charities.

I guess all financial investments are ponzi schemes in the end. All depend on there being more people able to pay more for something when you want to sell in the future. In a world of constantly increasing productivity and slowing, then zero population growth, such an investment should be daft and illogical, but for the obfuscating effects of credit and repression of housing supply by governments. (that really are a false return as they simultaneously deplete purchasing power)

Really we should focus on aiding deflation and productivity, not rentier based 'investment'.

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"To meet these aspirations, a 30 year old saver would need to save £12,000 a year, or £1,000 per month every year until retirement."

:lol::lol:

People would be more willing to save if they thought the system was fair, open transparent and trustworthy, with a high chance their money was not to be gambled, bet on and eroded away or diminished by fees and skimming....paying the high salaries of so called investors........who trusts these people anymore to care for their money when all they do is care for themselves.........anyway if something is seen to be possible and achievable people will aim high to obtain it.....if not live today, there is always pension credits, then you die. ;)

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Far better IMO to pay tax on your income then place some of it in a stocks and shares ISA. This will be in a way like having a SIP pension but you can decide what to do with your pot whenever you like. You can even spend it all and live on benefits if you want.

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Fred Goodwin's pension is £30k per month, down from his original £60k per month.

Evidentially not always a bad idea.

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I reckon if I own my house outright I could live comfortably (just me) on £10k per year. I wonder what these peoples' expectations are?

Inflated by a survey question. The survey being one conducted by a pensions company, so obviously no vested interest there ;)

The wording probably wasn't If you could wave a magic wand, how much would you like to retire on? Maybe something more subtle:

Edited by porca misèria

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Inflated by a survey question. The survey being one conducted by a pensions company, so obviously no vested interest there ;)

The wording probably wasn't If you could wave a magic wand, how much would you like to retire on? Maybe something more subtle:

After looking at a couple of providers, it seems people are being guided to expect two thirds of their income in retirement. With the state pension (if it still exists) on top.

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After looking at a couple of providers, it seems people are being guided to expect two thirds of their income in retirement. With the state pension (if it still exists) on top.

About £10,000 a year then :P

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Pensions have got to be the ultimate ponzi scheme. Why would you ever give your own money to someone else to look after in the hope you might get some back. These companies are not charities.

Allowing for salary sacrifice scheme and child benefit withdrawal, my marginal rate is up to 63%. (Employer gives me their NI contribution.)

So giving up £100 of gross income costs me £37 net.

I then withdraw £25 tax-free at age 55 (not too far away).

So £75 in pension has cost me £12 net

I then withdraw 3-4% p.a. using income drawdown and pay tax at 20% (will work a shorter week to keep income down). It takes me around 6 years to break even (age 61) then I'm up from then on, hopefully another 20+ years.

When I get to state pension age (67), get to the £20k minimum annual income for flexible drawdown, go abroad to pull the rest out in one go tax-free. This new drawdown scheme seems very handy.

Even allowing for the 0.6% management fees, I am far better off than paying the total effective income tax on it now.

They key thing is that your marginal tax rate is not your marginal income tax rate. You must include National Insurance and benefit withdrawal. Pension income is not subject to NI.

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I reckon if I own my house outright I could live comfortably (just me) on £10k per year. I wonder what these peoples' expectations are?

Yes, assuming the kids have moved out, and the mortgage is paid off how much do you need?

(I'm clearly not getting the whole 'greed is good' meme..)

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I never thought I'd be on a pension scheme. I got a new job last month and feel rather privileged that I'm now already on the way to prepare for my pension!

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Allowing for salary sacrifice scheme and child benefit withdrawal, my marginal rate is up to 63%. (Employer gives me their NI contribution.)

So giving up £100 of gross income costs me £37 net.

I then withdraw £25 tax-free at age 55 (not too far away).

So £75 in pension has cost me £12 net

I then withdraw 3-4% p.a. using income drawdown and pay tax at 20% (will work a shorter week to keep income down). It takes me around 6 years to break even (age 61) then I'm up from then on, hopefully another 20+ years.

When I get to state pension age (67), get to the £20k minimum annual income for flexible drawdown, go abroad to pull the rest out in one go tax-free. This new drawdown scheme seems very handy.

Even allowing for the 0.6% management fees, I am far better off than paying the total effective income tax on it now.

They key thing is that your marginal tax rate is not your marginal income tax rate. You must include National Insurance and benefit withdrawal. Pension income is not subject to NI.

:lol: Good luck with that, that avenues been snuffed of by HMRC, With the Qrops notification period extended from 5 to 10 years, 100% withdrawals are still possible if you want to pay 55% tax on it

Edited by georgia o'keeffe

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Allowing for salary sacrifice scheme and child benefit withdrawal, my marginal rate is up to 63%. (Employer gives me their NI contribution.)

So giving up £100 of gross income costs me £37 net.

I then withdraw £25 tax-free at age 55 (not too far away).

So £75 in pension has cost me £12 net

I then withdraw 3-4% p.a. using income drawdown and pay tax at 20% (will work a shorter week to keep income down). It takes me around 6 years to break even (age 61) then I'm up from then on, hopefully another 20+ years.

When I get to state pension age (67), get to the £20k minimum annual income for flexible drawdown, go abroad to pull the rest out in one go tax-free. This new drawdown scheme seems very handy.

Even allowing for the 0.6% management fees, I am far better off than paying the total effective income tax on it now.

They key thing is that your marginal tax rate is not your marginal income tax rate. You must include National Insurance and benefit withdrawal. Pension income is not subject to NI.

We are in a similar position to you and therefore it is worth putting money into a SIPP to keep the child benefit and get some higher rate relief. With the instant 25% top-up I can afford to make a few mistakes and laugh about it. After 15months our fund value is down a couple of thou but even overall (excluding the tax rebate we are about to reclaim).

Highlights Thorntons @ 10p sold 25p; record group @ 12p holding at 38p

Low lights Silvania Platinum @ 15p (60k shares gulp); Weatherly Intl @ 5p (50k) and Avocet Mining (punt 5k at 20p).

Treading water with IQE (25, 000 shares wil add if price drops back again).

Ultimately this money would have been taxed so heavily otherwise especially with the loss of child benefit ththat we can afford to have a bit of fun. It's our lottery ticket :D

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This is a measure of the absolute destruction and manipulation that the central bank have made of economy (together their mates in the rest of the banking system and the goverment from whom they are in their own words independent.

They have artificially manip[ulated ALL markets, jamming interest rates below any meaningful rate of return, manipulated stock markets and other investments higher meaning that any new(ish) entrants into the savings/investment and pensions marketrs is basically getting ripped off and will never match a suitable return from those markets (having to buy articificially high prices).

By the tiume the public realise what has been done to them, those that extracted millions in pensions or 100'000s in salaries and expenses form running this market rigging scheme will be done or buggered off back to the country they came from leaving the mess behind them. Just like new labour's treasury note.

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People no longer believe in pensions. There is no trust. Why would anyone invest in a pension knowing what Brown did and current annuity rates (yes I know there are other option to taking an annuity)? Most people see a need to have a retirement plan ... just not a pension, hence the BTL route for many ... similar yield as a pension but you get to keep the pot.

I think people no longer believe in "financial products", which only benefit the salesman! :blink:

Basically, if they are selling it at you, why don't they buy it all themseleves? :ph34r:

Edited by MrPin

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People no longer believe in pensions. There is no trust. Why would anyone invest in a pension knowing what Brown did and current annuity rates (yes I know there are other option to taking an annuity)? Most people see a need to have a retirement plan ... just not a pension, hence the BTL route for many ... similar yield as a pension but you get to keep the pot.

The problem which hardly anyone seems to get is that its not really an issue of pension trust but of the fundamental nature of how retirement works.

Money in retirement always comes from extracting income from younger generations who create the real wealth. In an aging nation the number wanting to extract increases while the relative number to be extracted from decreases. That means whatever way you choose to spin it, the end result is less return on average to each pensioner trying to "extract" from the younger generations.

Whatever schemes the gov dreams up or the retiree's try to implement themselves none can get around this fundamental flaw.

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Yes, assuming the kids have moved out, and the mortgage is paid off how much do you need?

(I'm clearly not getting the whole 'greed is good' meme..)

10K does it for a single person.

my income is a tad under 12K and it covers everything and I have rainy day money for the unexpected. My biggest expenses (having no mortgage) are council tax, utilities (oil and leccy and wood), and insurances. (none of which I can do much about) and paying tax on this amount.

this income is the state pension (earned from 40 years of NI payment) and a small private pension and a few dribs and drabs of share dividends and miniscule (taxed) savings income. lots of people I know are on the same kind of income (hardly rich boomers) :D

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Money in retirement always comes from extracting income from younger generations who create the real wealth. In an aging nation the number wanting to extract increases while the relative number to be extracted from decreases. That means whatever way you choose to spin it, the end result is less return on average to each pensioner trying to "extract" from the younger generations.

Whatever schemes the gov dreams up or the retiree's try to implement themselves none can get around this fundamental flaw.

Incorrect, the retiring generation could have, during its working years, laid down sufficient productive capital, physical or tertiary (effective valuable educations for their offspring for example) to be able to live off some of it

The baby boomers, from what i know, did no such thing, however

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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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