Saturday, November 13, 2010

More boomer moaning or real hardship?

More than a million pensioners paying mortgage

Why does everyone assume that old people are hard up? All the ones I know have stacks of cash. Constant propaganda from the boomer generation? As pointed out in the comments it doesn't make sense to pay off a mortgage (during the ZIRP). I'm sure there are poor old people - they are the ones that were poor when they were young as well.

Posted by chrisch @ 10:09 AM (2020 views)
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21 thoughts on “More boomer moaning or real hardship?

  • It’s just moaning generally, mixed in with ‘maybes’ and ‘whatifs’.

    “Share prices and savings rates fell during the credit crunch, leaving many pensioners without the money to pay off their home loans.”

    Shares fell and bounced back again. Dividend income only fell about ten or twenty per cent and is now picking up again. If you have savings (above and beyond emergency money) and a mortgage, and are expecting the interest income to pay off the interest expense then you need your head examining. Always pay off the mortgage first before you put a penny into anything else. Etcetera.

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  • materialistic weasle says:

    I’m not sure even the worst mortgage provider would allow you to take out a product that went over pensionable age.

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  • There are plenty of poor pensioners, I give you an example, my dad was a Mirror Group pensioner and after paying in plus lots of AVCs for 20-odd years got about 20% of what his payout would have been and not much more than the few thousand a year my mum got from her pension as a local authority worker.

    They made the effort to buy a place but unless they move its value means nothing as they can’t spend it, and they earn just enough in private pensions not to receive any of the handouts that their more feckless friends get through not having paid into pensions, getting a council house nearly free after living in it cheap most of their lives, and being smart enough to eat a diet of chips thereby earning a free mobility car just before retirement.

    Beyond that anyone who says there are no poor boomers just doesn’t get out much – there were plenty ordinary working people who didn’t benefit from company pensions, property inflation and so on, particularly those whose jobs and careers disappeared in the 80s (miners, steelworkers and so on) and who have subsisted on benefits or casual/manual work since.

    Having said that these aren’t the people the Telegraph is whingeing about but then again the Tories never cared about the working poor.

    I’m not talking about Labour’s client benefit-grabbing state here, I’m talking about hard-working, ordinary working class people who didn’t know how to play the system.

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  • There are plenty of poor pensioners, I give you an example, my dad was a Mirror Group pensioner and after paying in plus lots of AVCs for 20-odd years got about 20% of what his payout would have been and not much more than the few thousand a year my mum got from her pension as a local authority worker.

    They made the effort to buy a place but unless they move its value means nothing as they can’t spend it, and they earn just enough in private pensions not to receive any of the handouts that their more feckless friends get through not having paid into pensions, getting a council house nearly free after living in it cheap most of their lives, and being smart enough to eat a diet of chips thereby earning a free mobility car just before retirement.

    Beyond that anyone who says there are no poor boomers just doesn’t get out much – there were plenty ordinary working people who didn’t benefit from company pensions, property inflation and so on, particularly those whose jobs and careers disappeared in the 80s (miners, steelworkers and so on) and who have subsisted on benefits or casual/manual work since.

    Having said that these aren’t the people the Telegraph is whingeing about but then again the Tories never cared about the working poor.

    I’m not talking about Labour’s client benefit-grabbing state here, I’m talking about hard-working, ordinary working class people who didn’t know how to play the system.

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  • “Why does everyone assume that old people are hard up?”

    Why does everyone assume that old people are well off?

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  • @montesquieu

    There was no need to post your comment twice, the statement “I’m not talking about Labour’s client benefit-grabbing state here, I’m talking about hard-working, ordinary working class people who didn’t know how to play the system.” is absolutely spot on.

    Politicians of all political hues despise this group.

    They’re too conservative with a small “c” for Labour tastes, too working class for the Notting Hill and Shire tory types and the Liberals probably aren’t aware of their existence.

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  • Agree with montesquieu

    Whether you are rich is as much to do with the job you chose or were lucky (unlucky) enough to get, and general fortune in life as your age. I would have thought it blindingly obvious to everyone that some people acquire great wealth not through any special talents but simply by positioning themselves through luck or design to accumulate money via the distortions of our economic system.

    Some jobs that were well paid years ago are poorly paid now, and vice versa. And I imagine there will be many pensioners paying off a mortgage in future: they won’t be able to afford anything much before old age.

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  • We're All In This Together says:

    Poor is a relative term. A few people are rich, most people are poor, whatever their age.

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  • If pensioners don’t have enough pension then it’s their own fault.

    Their pensions are paid for by their offspring who do not bring any real money into the country because the nations ability to export is gone and it was the pensioners generation who lost it.

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  • mark wadsworth says:

    Most of what happens to you is down to luck.

    Even those people who say that they worked hard were just lucky enough to have the inate drive and the moments of clarity that told them an extra bit of effort now will benefit them in future. A lot of people had this drive or worked hard and still failed miserably through bad luck rather than stupidity or anything else.

    Turning to the topic in hand, all these people who claim to have ‘invested wisely in bricks and mortar to secure their future’ were just lucky enough to be the right age at the right time before Home-Owner-Ism became the overarching economic and political philosophy. And those kids who turned 18 since the late 1990s can pretty much whistle for it, they are the victims of all this.

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  • materialistic weazle – mortgage companies cannot “discriminate” against older people so it is your right to have a mortgage after retirement. All you need is to be able to prove you can pay it back – this as we all know is a load of old BS as 45% or so of loans were fraudulent during the boom. Some people take out a mortgage after retirement. BTL for example is based on yield not the age of the LL. Hence my criticism of the utter drivel in the “newspaper”.

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  • @10. ‘… so it is your right to have a mortgage after retirement.’ I also believe it is your right to be able to own your own property/land. But I don’t thik either is going to be realised for many many people over the next few years.

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  • Pensioners are one of the few groups with a guaranteed income these days, so as long as the mortgage is affordable on their pension income there is no issue at all with it. For example an individual who is 50 years old who has been building up a solid pension could quite reasonably take out a 25 year mortgage.

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  • @12 enuii,

    “For example an individual who is 50 years old who has been building up a solid pension could quite reasonably take out a 25 year mortgage.”

    Just for the record, most lenders would only consider the payable years of a loan that you are able to work, which would be the lawful working age… and that is until 65.

    So, someone who has built up a good pension at 50, would find it very difficult to find a good 25 year mortgage.

    Quite a few people on this site and the public are blaming the older generation, which is a bit unfair. They will be hit as hard as any, there will be no safe place during the rough times ahead; unless of course you are self sufficient or really rich.

    Pensions won’t cover the cost of retirement when inflation kicks in; these pensioners also have children, do you think they will stand by and watch them suffer ?

    We are all in this together, so stop blaming others and stick together.

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  • @13 debtfree…. How on earth can you suggest that we should ‘stick together’, when the people in power/with power are thinking of themselves. We all have different agendas, the differences are now too vast.

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  • Markj69 etc,

    You’ll know who to stick together with.

    I doubt you even know anyone in power (no offence).

    All the best.

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  • @ 15. debtfree… No offence taken.

    Power to the people!

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  • “and they earn just enough in private pensions not to receive any of the handouts that their more feckless friends get through not having paid into pensions”

    Could agree more. Just to think that plently of people on here CRITICISE the 90%+ of public service workers that pay into pensions just because they are subsidised. If you subsidise them now, it will cost you nowt later in life!

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  • @ 9: “Most of what happens to you is down to luck.”
    Yep, agree with this (*well it is true of me, at least).

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  • Uuurm!!!! whatever happened to “you must be able to pay off your mortgage before retirement!”. When I got my first mortgage in 1984, one of the main criteria (along with calculation of 3 1/2 times income!) was that it had to paid off at retirement age! Yes we have had the greedy bankers scenario but also far too many older people have gone and remortgaged to the hilts in order to live a lifestyle that they could not normally afford!

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