Pensions

[tim_noone]

No expert, but joining my works pension was the best thing I ever did. Maybe I joined at just the right time, when it started, but couldn't believe what I got out of it.

Don't be telling half a tale... Enlighten us all.

[tim_noone]

No - it will continue to grow.
Now stop worrying and have a beer !

[Walton]

The Prufund range is great for low-medium risk takers, and Royal London's governed portfolios are also a great product.

[barba]

The Prufund range is great for low-medium risk takers, and Royal London's governed portfolios are also a great product.

Ill second both of these and have and will continue to recommend both. Would be nice if Pru dropped their charges though.

Also a big fan of Vanguard Lifestyle Strategies for cheap global exposure

[Walton]

Yeah the Pru charges do add up, but even then the net return still makes it a great prospect.

The Lifestrategy funds are great, and at 0.22% you can't argue one jot. Even for fixed interest, Vanguard's offerings are good. Big fan of their methods, they know what they're doing.

[Clarets4me]

Pensions are now protected so it’s nowhere near as bad as previously (google the pension protection scheme)
If you transfer it to a private pension then yes the investment can go down aswell as up....but many of the big funds like Prudential have low risk funds which even in the last year when markets were down are achieving 6% to 7% growth.

The Pension Protection Scheme largely looks after ex-employees of the residual workers of nationalised Industries, ex Coal Board, British Steel and British Leyland ( Rover Group ), who's successor Companies went bump. Gordon Brown demolished the most successful Private and Company Pension scheme Industry in the world when Labour came to power in 1997 with his Tax changes, and the revelation that former Labour MP, Robert Maxwell had expropriated in the region of £400m, from the Mirror Group Pension fund to try to keep his ailing Empire afloat, did not help.

As Alastair Campbell is a former employee and staunch defender of the " Bouncing Czech ", I'd be interested to hear our most high profile & prominent fan's view on these events ??

[atlantalad]

If you are lucky to be in a works pension in good health and you have a guaranteed yearly income at retirement. That’s your option right there.
For me diabetic, uncontrolled high blood pressure and a heart issue with two options.
14000 a year for life.
Or
£500000 lumpsum in a draw down.
Now that’s a decision.
At 5% a year I can take £25 k and the lump sum remains about the same. If I kick it in 3 years my daughter gets 500k on drawdown. If I take the company 14k the trustees might give her half the 14k for ten years at most.

Lowbank I am in a similar position having just accepted a MARS and am faced with a similar dilemma.... do I transfer the pot +£500k and drawdown or just accept £18 k / yr . I have heart issues also so trying to gestimate life is difficult.

Like to know where you can get a return of 5% - that looks mighty attractive.

[TVC15]

The Pension Protection Scheme largely looks after ex-employees of the residual workers of nationalised Industries, ex Coal Board, British Steel and British Leyland ( Rover Group ), who's successor Companies went bump. Gordon Brown demolished the most successful Private and Company Pension scheme Industry in the world when Labour came to power in 1997 with his Tax changes, and the revelation that former Labour MP, Robert Maxwell had expropriated in the region of £400m, from the Mirror Group Pension fund to try to keep his ailing Empire afloat, did not help.

As Alastair Campbell is a former employee and staunch defender of the " Bouncing Czech ", I'd be interested to hear our most high profile & prominent fan's view on these events ??

That’s not what the Pension Protection Scheme does but I always love to see a Friday night rant !

[Quickenthetempo]

Obviously I'm no expert like some on here but the main problem with saving money is it's not worth as much in 50 yrs as it is now due to inflation.

50yr ago 5 pounds could of paid for a night out maybe. Now it's not even the taxi fare to the pub.

The best thing you can do in my eyes is put whatever spare into the best house you can buy and sell it at retirement age and move abroad to a cheaper economy.
250k or so will go along way in Vietnam nam or similar.

Remember the pension was introduced with thinking behind it was most wouldn't reach that age to collect.

[barba]

Lowbank I am in a similar position having just accepted a MARS and am faced with a similar dilemma.... do I transfer the pot +£500k and drawdown or just accept £18 k / yr . I have heart issues also so trying to gestimate life is difficult.

Like to know where you can get a return of 5% - that looks mighty attractive.

Although im licenced to undertake final salary pension transfers I, like other advisers are moving away from them. The cost of personal indemnity insurance, the hours they take to transact and the lifetime of liabilty being significant factors.

To loosely use your circumstances to demonstrate the risk. A 60 year old an £18k pension or a £500k, it would on the face seem to be good trade.

They transact take £50k lump sum and then £25k a year. Investment markets are flat and dont grow in 2 years. Then the markets drop 30% which considering we are near the end of the economic cycle and have had a near decade of a bull run it is not impossible. After three years the £500k is close to £300k and under normal life expectancy they still have over 20 years to live.

They then start to be worry and look at what they can draw to make sure the pot will last their lifetime. This would be around 3% so less than £9k per annum. All of a sudden the £18k looks attractive. They suddenly think the advice is now bad, complain and the adviser i.e me has to fund their retirement difference.

I did say loosely as I tended to have three questions I asked to filter out queries:

- Are there health considerations.
- Is there a desire to leave money to non dependent beneficiaries
- is there other guaranteed income in the background

Anyone wanting to do this needs to use a pension transfer specialist. If advisers like me are withdrawing then it makes then pool smaller and the costs potentially higher.

I would recommend not taking advice on a contingency basis. I.e the adviser only gets paid if the transaction proceeds because unsurprisingly the advice will be to transfer. The downside is you may pay to be told its not a good idea.

[Lowbankclaret]

Lowbank I am in a similar position having just accepted a MARS and am faced with a similar dilemma.... do I transfer the pot +£500k and drawdown or just accept £18 k / yr . I have heart issues also so trying to gestimate life is difficult.

Like to know where you can get a return of 5% - that looks mighty attractive.

There is a company in Preston that a friends of mines Mother is using, the company has achieved 5% plus for over ten years. They are wealth management company.

https://www.sjp.co.uk/" onclick="window.open(this.href);return false;

They can offer advise, I cannot.

[yorkyclaret]

Don't be telling half a tale... Enlighten us all.

OK then, Paid in minimum of 2% of wage, employer paid in 3%. Was in it for about 16 years, for round figures I estimate I paid in 4K the company 6K (didn't get paid a lot), Due to my health and needing to look after 88 year old dad, I cashed in at age 59. Transfered out a little under 147K.

[Steve1956]

Talking of Pensions I don't know if it's been mentioned on here,does anyone think the pension age will be put back to its original age 65 for Men 60 for women,surely this is a vote winner for the next election, think I've read somewhere this is going to court,really was legalised robbery of women born in the 50s stealing 6 years worth of their pensions.

[J50]

Well I quite like the property angle to provide a pension. I always had this idea to own 4-5 holiday lets and live off the income from them and use them out of season or when they're not let for different places to visit around the country. Eventually sell off our main home, buy somewhere cheaper and smaller and use the cash to pay off any mortgages on the BTLs. Didn't get round to doing this though unfortunately.

So fast forward to now and after a useful property investment which I sold after 5 years I've now bought 2 flats and 2 student 4 bed properties - in an ultra prime student location. So I'm getting pretty decent income from those, they are mortgaged. Plan is to buy the same again over the next couple of years then we in a few years time sell the main home and live off these rentals which can then become mortgage free.

So that's my pension plan, you can rip it apart if you like!

One benefit of all of this is that I can put a lot of travel up and down the country down to the business of the BTL. Also a lot of purchases can be put against the income etc. Weekend away with the wife? That'll be checking out that town for a holiday let...

[Rileybobs]

Well I quite like the property angle to provide a pension. I always had this idea to own 4-5 holiday lets and live off the income from them and use them out of season or when they're not let for different places to visit around the country. Eventually sell off our main home, buy somewhere cheaper and smaller and use the cash to pay off any mortgages on the BTLs. Didn't get round to doing this though unfortunately.

So fast forward to now and after a useful property investment which I sold after 5 years I've now bought 2 flats and 2 student 4 bed properties - in an ultra prime student location. So I'm getting pretty decent income from those, they are mortgaged. Plan is to buy the same again over the next couple of years then we in a few years time sell the main home and live off these rentals which can then become mortgage free.

So that's my pension plan, you can rip it apart if you like!

One benefit of all of this is that I can put a lot of travel up and down the country down to the business of the BTL. Also a lot of purchases can be put against the income etc. Weekend away with the wife? That'll be checking out that town for a holiday let...

Have you just admitted to tax evasion on a public forum?

[tim_noone]

OK then, Paid in minimum of 2% of wage, employer paid in 3%. Was in it for about 16 years, for round figures I estimate I paid in 4K the company 6K (didn't get paid a lot), Due to my health and needing to look after 88 year old dad, I cashed in at age 59. Transfered out a little under 147K.

Aaah well done didn't think the wpp had been operating that long...

[tim_noone]

Obviously I'm no expert like some on here but the main problem with saving money is it's not worth as much in 50 yrs as it is now due to inflation.

50yr ago 5 pounds could of paid for a night out maybe. Now it's not even the taxi fare to the pub.

The best thing you can do in my eyes is put whatever spare into the best house you can buy and sell it at retirement age and move abroad to a cheaper economy.
250k or so will go along way in Vietnam nam or similar.

Remember the pension was introduced with thinking behind it was most wouldn't reach that age to collect.

Good post...In particular the last paragraph

[J50]

Have you just admitted to tax evasion on a public forum?

Nope. Just legitimate and fully documented and substantiated avoidance.

[Blackrod]

Frightening thread. This is great that is great. For who ? A little knowledge .....

[barba]

Talking of Pensions I don't know if it's been mentioned on here,does anyone think the pension age will be put back to its original age 65 for Men 60 for women,surely this is a vote winner for the next election, think I've read somewhere this is going to court,really was legalised robbery of women born in the 50s stealing 6 years worth of their pensions.

I would doubt very much that the reversal will happen.The cost for the estimated 300,000 woman who have moved from 60 to 65 is estimated to be £30bn adding in all woman and all woman would be alot.

Whilst I feel sympathy for those who moved quickly from 65 to 66 the change from 60 to 65 was over 20 years ago and has been heavily publicised over the years.

[Lowbankclaret]

Frightening thread. This is great that is great. For who ? A little knowledge .....

I have tried to put good and bad points of several options, and also told people to go for professional advice.
In the past 3 years I have had 4 people come to house to give me advise.

3 of them I knew more than they did, tied them up in knots with their **** advise.

The 4th who was really good offered me a job. We agreed on every point just about.

The real point is there is no one plan fits everyone, everyone is in a different position. So you need to make your pension fit you.

[Hozz]

I’ve been putting my money into property and vintage synths plus a couple of Banksies. Started a pension but won’t expect much being always self employed.

[Steve1956]

I would doubt very much that the reversal will happen.The cost for the estimated 300,000 woman who have moved from 60 to 65 is estimated to be £30bn adding in all woman and all woman would be alot.

Whilst I feel sympathy for those who moved quickly from 65 to 66 the change from 60 to 65 was over 20 years ago and has been heavily publicised over the years.

A no deal brexit....the money is there.

[cricketfieldclarets]

Talking of Pensions I don't know if it's been mentioned on here,does anyone think the pension age will be put back to its original age 65 for Men 60 for women,surely this is a vote winner for the next election, think I've read somewhere this is going to court,really was legalised robbery of women born in the 50s stealing 6 years worth of their pensions.

Hope so. Doubt it though.

[cricketfieldclarets]

Well I quite like the property angle to provide a pension. I always had this idea to own 4-5 holiday lets and live off the income from them and use them out of season or when they're not let for different places to visit around the country. Eventually sell off our main home, buy somewhere cheaper and smaller and use the cash to pay off any mortgages on the BTLs. Didn't get round to doing this though unfortunately.

So fast forward to now and after a useful property investment which I sold after 5 years I've now bought 2 flats and 2 student 4 bed properties - in an ultra prime student location. So I'm getting pretty decent income from those, they are mortgaged. Plan is to buy the same again over the next couple of years then we in a few years time sell the main home and live off these rentals which can then become mortgage free.

So that's my pension plan, you can rip it apart if you like!

One benefit of all of this is that I can put a lot of travel up and down the country down to the business of the BTL. Also a lot of purchases can be put against the income etc. Weekend away with the wife? That'll be checking out that town for a holiday let...

Whats the tax situation with those lets. Donyou get taxed as a normal income or...

Also stamp duty etc?

[J50]

Yes stamp duty annoying on purchase but it is what it is and lowers the return slightly. Taxed as income - after all the expenses and costs of course.

[dsr]

Talking of Pensions I don't know if it's been mentioned on here,does anyone think the pension age will be put back to its original age 65 for Men 60 for women,surely this is a vote winner for the next election, think I've read somewhere this is going to court,really was legalised robbery of women born in the 50s stealing 6 years worth of their pensions.

Women's equality - a good thing or not? Now, I'm not talking about the extra 4-5 years' pension that women will get a the end of life because they live longer than men; just that in today's climate suggests that women deserve the same employment rights as men. Should all that be thrown out the window?

You could certainly make a case that men should retire 5 years before women; the case that women should retire 5 years before men is nonsense, and has been ever since the Equal Pay Act came into force.

[dsr]

Lowbank I am in a similar position having just accepted a MARS and am faced with a similar dilemma.... do I transfer the pot +£500k and drawdown or just accept £18 k / yr . I have heart issues also so trying to gestimate life is difficult.

Like to know where you can get a return of 5% - that looks mighty attractive.

£18k per year after tax is £14.5k. With a £500k cash in the building society, earning 1% interest, you can take out £14.5k per year for over 40 years. How long do you plan to live?

Inflation is the killer, of course. But given the likelihood or otherwise of being able to go on expensive holidays when you get past 80 or so, and the certainty that someone else will pay your nursing home fees when needed if you've spent the lot ...

Take professional advice. But annuities have been paying dreadful rates for some time.

[Steve1956]

Women's equality - a good thing or not? Now, I'm not talking about the extra 4-5 years' pension that women will get a the end of life because they live longer than men; just that in today's climate suggests that women deserve the same employment rights as men. Should all that be thrown out the window?

You could certainly make a case that men should retire 5 years before women; the case that women should retire 5 years before men is nonsense, and has been ever since the Equal Pay Act came into force.

I take it you don't like women then.

[dsr]

I take it you don't like women then.

That's a silly think to "take".

I dare say loads of men love the idea of working five years' extra so that women can retire earlier. Do I assume from the "1956" in your user name that "Steve" is a girl's name?

[Steve1956]

My wife and I are a couple,stealing 6 years pension off her is also stealing it off me which ever way you look at it.

[dsr]

My wife and I are a couple,stealing 6 years pension off her is also stealing it off me which ever way you look at it.

Pensions are a state benefit, not something that you earn the right to by contributions.

But perhaps you could make up the difference by allowing her to retire at 64 and a half, while working yourself until 69 and a half. You would still have the benefit of working the extra five years, and the money would be the same.

But I'm not willing to work more years just to allow women early retirement. It's an utterly unjustified idea, and has been since before your wife started work.

[Steve1956]

Pensions are a state benefit, not something that you earn the right to by contributions.

But perhaps you could make up the difference by allowing her to retire at 64 and a half, while working yourself until 69 and a half. You would still have the benefit of working the extra five years, and the money would be the same.

But I'm not willing to work more years just to allow women early retirement. It's an utterly unjustified idea, and has been since before your wife started work.

Sound advice cheers .

[mdd2]

There is no logic to women receiving the State Pension before men and given the present average life expectancy for men and women aged 65 in 2019 is projected to be 21 and 23 years it is easy to see why retirement for the State Pension is to be extended especially given that only about 30 million people are employed and about 12 million of us are over 65.

[barba]

My wife and I are a couple,stealing 6 years pension off her is also stealing it off me which ever way you look at it.

Its not stealing but a change, predominately based on longer life expectancy that was enshined in law 24 years ago.

The Government would have written to your wife multiple times over this period to ultimately inform and to trigger you to plan for the change.

[Hipper]

Talking of Pensions I don't know if it's been mentioned on here,does anyone think the pension age will be put back to its original age 65 for Men 60 for women,surely this is a vote winner for the next election, think I've read somewhere this is going to court,really was legalised robbery of women born in the 50s stealing 6 years worth of their pensions.

There was another gender equality arrangement introduced for annuities in 2012:

https://www.telegraph.co.uk/finance/per ... ncome.html" onclick="window.open(this.href);return false;

To me this seems unfair because it is an individuals investment unrelated to gender. The gender aspect is an insurance type assessment, similar to your health/smoking and so on. It's still a fact that women live longer.

[mdd2]

Another crazy European rule.
They can use the extra cash to pay for car insurance as their safety record was penalised because of sex discrimination rules too I seem to recall.
How long before I have to got for a mammogram and females need a PSA because one cannot discriminate on grounds of gender?

[Hipper]

... in theory!

https://www.independent.co.uk/money/spe ... 69816.html" onclick="window.open(this.href);return false;

[South West Claret.]

What an awful lot of people don't seem to realise is that your pension is merely "deferred wages" and you must regard and guard them as such in the most economic way that you can think of.

One of the big problems is that most people because they won't be able to realise the value of it (i.e. cash them in for many years) they tend to glaze over and forget about them.

As said above if you were in the fortunate position of being offered an index linked pension or other where your employer contributed more than you did you should have grabbed it and count your blessings for the future.

Fortunately now there is lots of information out there so it's up to you seek out the most impartial that's applicable to you.

Lastly you must review your pension every year and make sure that it's growing and if not do something about it as there are loads of inefficient and very shady individuals who will promise you the earth get you signed up and either mismanage an or disappear with you hard earned money.

If you are thoughtful and do realise the importance of your pension as you get older you can take control of your own pension and manage it yourself by way of a SIPP.

Good luck it's a mind field out there.