Turn Your Pension Pot Into Cash - Osborne Says

[200p]

Turn your pension pot into cash: 5million people will be able to sell their annuity for a lump sum from 2017

• Existing pensioners will be able to sell their pension pots for a lump sum
• Treasury says people should be trusted with their own hard-saved money
• Experts warn against rushing to cash-in on annuities using new rights

Five million people will be able to turn their pension pots into a a cash lump sum from April 2017, the government announced today.

http://www.dailymail.co.uk/news/article-3360622/Turn-pension-pot-cash-5million-people-able-sell-annuity-lump-sum-2017.html#ixzz3uP7FaCfP

Edited December 15, 2015 by 200p

[200p]

This reminds me of the Pools winners, who vowed to "Spend, Spend, Spend".

I hope there will be room at the poor house in 2020, but the money pouring into the economy will ensure Tory's are in, after spending this one time payment.

[winkie]

Short-termism rules the day......will it last 3 to 5 years?......recommended for anyone with a terminal illness.

[StainlessSteelCat]

Time to find some spendthrift but healthy living boomer and buy their annuity off them for a song or trade it for a crappy BTL on a sink estate?

[winkie]

Time to find some spendthrift but healthy living boomer and buy their annuity off them for a song or trade it for a crappy BTL on a sink estate?

Money to be made from second-hand annuities.......what is this now, cash converters?.....how low can you go.

[porca misèria]

Enabling a market, but that's all. I'd expect it to be pretty thin:

- an income tied to someone else's life is not the most attractive investment for most of us

- so selling prices will look pretty poor compared to the income.

Who wants to sell a £5k-for-life income for maybe 15k (or much less if you're ill)?

I guess it might be something for when you're on the point of entering a rest-of-your-life care home. Part of the care deal.

I expect someone will start pooling annuity incomes into a fund for investors with an appetite for risk. Could make sense for some pensioners - e.g. those on higher-rate income tax, or those with a mortgage to pay off - to re-organise their finances. And bear in mind, anything they sell off is on top of the state pension.

[zugzwang]

[billybong]

So if you're getting a 5% pension annuity you can cash it in (at poor value compared to the original capital sum) and deposit it at 1%. Great - they've leeched on the way in and now they're going to leech on the way out. Watch out for the blatant frauds as well.

Ok take a risk and put it into BtL or shares etc and try your luck - good luck with that or just spend spend spend. 2017 - neat timing for the next general election.

Also neat timing for the eu referendum - a timely boost to the economy which will naturally only be because of being in the eu.

Ah but it's people are best at handling their own money.

It depends on how it's all valued, what the lump sums will be - but one suspects that it will be yet another extremely rotten deal.

Edited December 15, 2015 by billybong

[TheCountOfNowhere]

spend your pension. preferably on a buy toilet.

Edited December 15, 2015 by TheCountOfNowhere

[TheCountOfNowhere]

this bloke doesn't quite understand what a pension needs to be about.

this mam, IMHO, is a calamity for the UK.

[tinker]

Maybe spending your pensions is to Osborne what spending your houses (mewing) was to Brown (latter worth about 3% of GDP growth I seem to recall).

As with all politicians, it is about keeping the pretence going.

[tinker]

Dupe.

Edited December 15, 2015 by tinker

[olde guto]

Proof it were ever needed that the alleged recovery is just smoke and mirrors.

Maybe they plan a double whammy to the economy, firstly from this money that is released and then from the compensation payouts from the resulting "misselling" scandal. Isn't the demographic being targeted by this measure roughly the same one that fell for the endowment "misselling" scandal?

[VeryMeanReversion]

My stepfather took out a joint-life annuity but subsequently remarried. He wants to sell the annuity and rebuy again with the new wife named as beneficiary.

A good reason but I suspect the fees will be horrendous.

[TheCountOfNowhere]

does anyone not think this is another back door prop for house prices?

let the old invest their money in a good old fashioned pyramid scheme.

[Ash4781]

I think the tax will be another problem cashing out.

I Imagine its setup so that those with over £x amount will have to get advice and those under £x who also won't have a clue will get a link or leaflet to that pensions website.

[olde guto]

I think the tax will be another problem cashing out.

I Imagine its setup so that those with over £x amount will have to get advice and those under £x who also won't have a clue will get a link or leaflet to that pensions website.

Those that don't have a clue will have a call centre more than happy to help them release their money, cue the next "misselling" scandal in about 5 years when all the money is spunked away.

[Wurzel Of Highbridge]

All well and good having your pension in cash until the governemnt / BOE decide to devalue the pound again.

[sikejsudjek]

Stupid idea. No doubt more fuel to the fire of buy to let. This chancellor continues to not understand the dangers of a ponzi asset bubble economy.

[janch]

I got a quote for the annuity and did a quick calculation to see that it would take me about 17 years at the rate they quoted before I would be in profit ie getting more than I'd paid in. I didn't allow for inflation so it was only quite rough but I thought that was a good deal. I've had 4 payments already so only another 13 to go before profit. It's a very small annuity so I don't pay any tax but I reckon I should be quids in in the end. I'm determined to beat them (banks/insurance company/government) at their own game.

[sPinwheel]

I got a quote for the annuity and did a quick calculation to see that it would take me about 17 years at the rate they quoted before I would be in profit ie getting more than I'd paid in. I didn't allow for inflation so it was only quite rough but I thought that was a good deal. I've had 4 payments already so only another 13 to go before profit. It's a very small annuity so I don't pay any tax but I reckon I should be quids in in the end. I'm determined to beat them (banks/insurance company/government) at their own game.

Nice one. And make sure you pile it into a BTL in Preston.

[Bruce Banner]

I got a quote for the annuity and did a quick calculation to see that it would take me about 17 years at the rate they quoted before I would be in profit ie getting more than I'd paid in. I didn't allow for inflation so it was only quite rough but I thought that was a good deal. I've had 4 payments already so only another 13 to go before profit. It's a very small annuity so I don't pay any tax but I reckon I should be quids in in the end. I'm determined to beat them (banks/insurance company/government) at their own game.

That was my thinking when I bought mine in 2008.

It worked out at 14 years to get back what I paid in, I am now over half way there. Bearing in mind that the money was tax free (in and out) I don't see it as a bad deal.

[Assume The Opposite]

Stupid idea. No doubt more fuel to the fire of buy to let. This chancellor continues to not understand the dangers of a ponzi asset bubble economy.

He does understand. He just doesn't care.

[Travisher]

Of course the black swan that will bite your **** may be a flu outbreak and that year's vaccine fails to prevent it killing off all your cows at once. Nothing in risk is truly Gaussian, it is fractel. Looks like the 'same old same old' until it isn't.

Edited December 16, 2015 by Travisher