Jump to content
House Price Crash Forum
TheCountOfNowhere

privatization of taxes

Recommended Posts

Pensions: Automatic saving to start at 18 under new plans

http://www.bbc.co.uk/news/business-42366471

 

I said a few years ago that the government will eventually FORCE people to take out a private pension.

This is happening now.  

When people opt out of these schemes their droves, the government will, I have no doubt, make it compulsory.

This is the end of the road.  This is privatization of taxation.  Taking from the workers going directly to the London spivs.

Meanwhile, retirement age is pushed back, the value of peoples savings are decimated and house prices pushed up in order to take pretty much your life times earning off you,

The UK is not a place to live now.

The UK is heading for disaster.

 

All  IMHO, I could be wrong, I dont own a house so what do I know.

Share this post


Link to post
Share on other sites

I don't see anything wrong in encouraging people to save some of their income for later. It's not taxation by any stretch of the imagination.

If it exposure to equities and bonds via their pension scheme shakes people out of their 'pwoperdee is my pension' mindset then all the better! 

Share this post


Link to post
Share on other sites

I'm not generally in support of telling people what to do with their own money, but I wonder if it would be so bad if people had a more comprehensive range of options as to how to invest their pension?  SIPPs are better than nothing, but what if we could carry out any investment or business activity within a pension?

It would get people thinking long term, and maybe more willing to take risks early if they have a small pot of money they can't touch now anyway except to invest, trade or capitalise a small business with.

There would need to be proper regulation and tracking of money flows to prevent money being fraudulently transferred out via artificially contrived transactions, but in many ways it would be no different to a Ltd company structure where the company is considered in individual entity separate from the owner(s).  In this case the pension would be like a separate legal "future self", that doesn't pay tax.

 

Edited by ManVsRecession

Share this post


Link to post
Share on other sites

How many potential start up businesses will all this rubbish kill before they even start. The UK is going to hell in a hand cart and this will only serve to speed things up. I thought everyone was supposed to be auto enrolled in a pension already with much less red tape for businesses in the state pension.

Share this post


Link to post
Share on other sites

The problem stems from lack of knowledge and education about investing into a pension....people often  would prefer to invest and choose themselves but lack the knowhow.....in the 80s during the time of privatisation of our utilities it was actively encouraged, lots of information and marketing, easy to buy and sell stocks and shares for little or no cost at all local banks......today there is lack of information, lack of trust, lack of transparency, training...fees and costs are not always clear and can be high, lack of security and feel that savings will be safe, 

 

.... knowledge is power, little knowledge = powerless. ;)

Share this post


Link to post
Share on other sites
48 minutes ago, anonlymouse said:

I don't see anything wrong in encouraging people to save some of their income for later. It's not taxation by any stretch of the imagination.

 

Im talking about 24 months from now when it becomes compulsory, that is taxation.

We already pay a fortune in taxes, well some of us do, which should be enough to live on in retirement,

Instead the bankers make the £ worthless and "encourage  investment"....speculation more like, investments can go down as well as up, but the spivs never pay back their 10% commission.

 

Share this post


Link to post
Share on other sites
5 minutes ago, TheCountOfNowhere said:

Investments can go down as well as up, but the spivs never pay back their 10% commission

In my first year of the NEST scheme the annual charges amounted to around 2%, which will go down to around 0.5% over the next few years. My private investments have an overall cost of 0.4% per annum including management, dealing and platform charges. In a decade or so my annual costs will be in the region of 0.25%.

There's absolutely nothing speculative about owning a little bit of lots of profitable businesses and getting a share of their profits.

Share this post


Link to post
Share on other sites
43 minutes ago, winkie said:

The problem stems from lack of knowledge and education about investing into a pension....people often  would prefer to invest and choose themselves but lack the knowhow.....in the 80s during the time of privatisation of our utilities it was actively encouraged, lots of information and marketing, easy to buy and sell stocks and shares for little or no cost at all local banks......today there is lack of information, lack of trust, lack of transparency, training...fees and costs are not always clear and can be high, lack of security and feel that savings will be safe, 

And the poor education and information isn't an accident.  The financial institutions deliberately makes things sound more complicated than they are to discourage people from doing it themselves.  They want people to think they need someone else to invest their money for them.

Share this post


Link to post
Share on other sites
41 minutes ago, anonlymouse said:

In my first year of the NEST scheme the annual charges amounted to around 2%, which will go down to around 0.5% over the next few years. My private investments have an overall cost of 0.4% per annum including management, dealing and platform charges. In a decade or so my annual costs will be in the region of 0.25%.

There's absolutely nothing speculative about owning a little bit of lots of profitable businesses and getting a share of their profits.

Depends on what this "profit" is based on.

 

DRUmqh8XcAAeCcU.jpg

Share this post


Link to post
Share on other sites

Buying individual stocks is a risky business as your chart shows.

Buying the index is both cheaper and carries less risk - the S&P500 (with dividends reinvested) has delivered on average 10% returns each year, FTSE about 7%, emerging markets 6-10%.

Of course you get quite regular crashes but over 25-30 years you'll do very well. If you need your money soon then move it into cash or bonds, which is exactly what the NEST scheme does when you're 10 years away from retirement. 

Share this post


Link to post
Share on other sites
3 hours ago, TheCountOfNowhere said:

 

I said a few years ago that the government will eventually FORCE people to take out a private pension.

This is happening now.  

When people opt out of these schemes their droves, the government will, I have no doubt, make it compulsory.

It's not a new thing. In the 1970s it was normal for companies to have compulsory enrolment. OK it wasn't the government but you still didn't really have a choice.

Share this post


Link to post
Share on other sites

No reason people can't invest in an ETF via a SIPP, if they don't want to pick individual stocks. Or mutual funds / robo-investor services if that's your thing. Trackers and market ETFs have their own risks too though. All the main equity markets are highly correlated - when one goes down hard, they all do, which can be a problem if it happens at the wrong time in your personal investment cycle.

Some people would like to take a more sophisticated approach to hedge the downside, maybe using options or shorting. Or invest in a friend's business.

I say let people make their own decisions as to what they consider risky. We're all grown adults after all.

If we were forced to pay into a pensions scheme, AND denied the ability to invest and hedge how we choose, then I would consider that a de-facto privatisation of taxes, forcing us by law into long-only positions and driving asset prices further into the stratosphere. 

Share this post


Link to post
Share on other sites
2 hours ago, ManVsRecession said:

And the poor education and information isn't an accident.  The financial institutions deliberately makes things sound more complicated than they are to discourage people from doing it themselves.  They want people to think they need someone else to invest their money for them.

....my feelings also.....we don't want to make it easy for you to do yourself, we want you to pay others to do it for you......you might lose yourself lots of money without help and assistance.;)

Edited by winkie

Share this post


Link to post
Share on other sites
44 minutes ago, ManVsRecession said:

I say let people make their own decisions as to what they consider risky. We're all grown adults after all.

I understand why you say that but from a societal perspective it doesn't work. What happens when everywhere is littered with starving people who thought putting it all on the roulette wheel was low risk. It's like some people think they ought to be allowed to opt out of NI/NHS and take responsibility for their own medical care - society as a whole can't just ignore people having a heart attack in the street.

Share this post


Link to post
Share on other sites
3 hours ago, doomed said:

How many potential start up businesses will all this rubbish kill before they even start. The UK is going to hell in a hand cart and this will only serve to speed things up. I thought everyone was supposed to be auto enrolled in a pension already with much less red tape for businesses in the state pension.

The automatic pension rules are absolutely crucifying.

IMO they should exempt businesses with fewer than 4ish employees.  

Share this post


Link to post
Share on other sites
58 minutes ago, Errol said:

You can opt out anyway.

Just to point out from a SME point of view -- You have no choice but to set up a pension, give them all the info, let them make the decision on their own (no influencing), then they opt out, then the pension provider lets you know.

I have 5 employees at the moment.  None of them have taken up the pension (most are in their 50s and wealthy enough).  All of the hassles are still there.  

Share this post


Link to post
Share on other sites
17 minutes ago, Funn3r said:

I understand why you say that but from a societal perspective it doesn't work. What happens when everywhere is littered with starving people who thought putting it all on the roulette wheel was low risk. It's like some people think they ought to be allowed to opt out of NI/NHS and take responsibility for their own medical care - society as a whole can't just ignore people having a heart attack in the street.

On the other hand if you don't let people face the consequences of being irresponsible they never learn, and you end up with a population that never grows up and needs nannying to get through life. Like in so many things striking the right balance is nigh upon impossible when most of the pressures are pushing exclusively in one direction or another; it requires someone to step in and act, and for them to be able to judge the right point.

Share this post


Link to post
Share on other sites
13 minutes ago, Riedquat said:

On the other hand if you don't let people face the consequences of being irresponsible they never learn, and you end up with a population that never grows up and needs nannying to get through life. Like in so many things striking the right balance is nigh upon impossible when most of the pressures are pushing exclusively in one direction or another; it requires someone to step in and act, and for them to be able to judge the right point.

...but what government wants to spell out the truth, if you can't provide for yourself by planning ahead,  there may not be the money about for the state to pay for what is to be expected, to pay future spending and living/housing costs.......very many will say will cross that bridge if we come to it, nothing is guaranteed, the future is unknown saving or no saving......need the money today to live.;)

Edited by winkie

Share this post


Link to post
Share on other sites
15 minutes ago, Funn3r said:

I understand why you say that but from a societal perspective it doesn't work. What happens when everywhere is littered with starving people who thought putting it all on the roulette wheel was low risk. It's like some people think they ought to be allowed to opt out of NI/NHS and take responsibility for their own medical care - society as a whole can't just ignore people having a heart attack in the street.

I disagree.  it would be good for society.  

There's nothing stopping people putting everything they have on the roulette wheel now, but hardly anybody does.  Those that do are generally desperate for quick rewards, which they won't have immediate access to if it's in a pension.

Those that do go for high risk bets will learn by experience whether they work or not, hopefully early on in their lives when they have time to rebuild capital. I don't imagine many middled aged and above people who've bene paying in for years being so reckless, but if they know what they're doing, maybe some will, and benefit from it.

If you're going to dictate what risks people can take, who decides what's risky?  The politicians? what do they know about financial markets?  Or maybe the bank? the've proven themselves pretty incompetent too. 

It's not the same as opting out of the NHS.  That's a public service that requires taxes to run. A pooled insurance scheme of sorts.  Pensions are wrappers for our own money that is intended to benefit us personally..

Share this post


Link to post
Share on other sites
4 hours ago, anonlymouse said:

I don't see anything wrong in encouraging people to save some of their income for later. It's not taxation by any stretch of the imagination.

If it exposure to equities and bonds via their pension scheme shakes people out of their 'pwoperdee is my pension' mindset then all the better! 

+1

It's an odd logic that views the encouragement of highly tax efficient savings as a tax. Some people consider large contributions as tax avoidance.

Takes all sorts I suppose. 

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

Loading...

  • Recently Browsing   0 members

    No registered users viewing this page.

  • 406 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%



×
×
  • Create New...

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.