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      12-24-2012, 05:54 AM   #1
SteveC
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Britain's sleep walking into its next crisis

At some point in time even BMW drivers retire.

Would you like to continue to drive a BMW once you do?

Well if you would, you'd better wake up now and start doing some very creative planning, regardless of your age, because the trend is looking like you'll be lucky to pay your gas and electricity and council tax bills AND put food on the table. Unless you start doing something now beyond just State and Company Pensions, there's almost certainly a used Micra in your future!

A fate worse that death? The facts don't look promising

Were you aware for example that saving the maximum amount annually in a company and/or private pension until you reach the Government's recently introduced limit will give you an annual income of just 25,166 for an index linked pension with 50% widow's cover.

Add the State Pension and you're maxed out at 29,742 nett income.

That's correct. Max out your NI contributions and your company and private pension allowance and you can look forward to 2,400 a month.

According to the Government, only 6% of families will reach that limit, so most will never see even that relatively meagre amount.

The chasm between regular employment and pension income has never been wider and the Euro crisis and subsequent UK Governments' propensity to raid pension pots is making it worse.

The recent economic collapse was already clearly predictable back in 2003, given the house of cards that passed for economic policy. The next perfect storm of old age poverty is now gathering.

Anyone depending solely on their State and Company Pensions for retirement is probably in for one of the biggest dissapointments of their life and the situation is unlikely to improve any time soon.

I'm selling nothing.....just saying that the writing is once again most clearly on the wall. Government policy is now cynically predicated on the electorate having an expert's understanding of the tax code and the various shelters it offers. 'Cynically', because they know very well it doesn't.
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      12-24-2012, 06:04 AM   #2
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Cheery post on Xmas Eve Steve,could you not have shortened the post,and just written:

Bah humbug!

Anyway,it's Xmas, neck some whisky and get blatted,wake up on the 2nd Jan,and restart the miserable thread,we can all moan like fuck with you then.

Happy Xmas Steve
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      12-24-2012, 07:27 AM   #3
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While what you say might be true, I've got a few things to add.

1) 2400 is actually a decent amount of money when you are retired and have no mortgage or other dependants to pay for. My parents pension is less that that a month and they do absolutely fine, they can even afford to have the heating on .

2) I won't be betting my financial future on the hope that the government will give me a handout when I retire, a pension is only one small part of my future financial plans. Besides I won't be here when I retire anyway, I'll be living in a warmer, cheaper country where my money will go a lot further so am I bleak about my future pension prospects\retirement. Not in the least, I am positively looking forward to it.
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      12-24-2012, 07:37 AM   #4
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Bah Humbug!

Brilliant idea! I'll stop reading the Sunday paper financial sections,
bring a magnum of carefully aged Rioja up to room temperature and do exactly as you suggest.

Isn't this forum great

Happy Xmas to all
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      12-24-2012, 07:39 AM   #5
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Or... You Could Just Work Harder.................and Earn More.
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      12-24-2012, 07:57 AM   #6
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As above, 2400 per month should be plenty with much reduced outgoings.
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      12-24-2012, 10:19 AM   #7
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2400 in next 30-35 years is going to be nothing.

I work for health sector and I have been told 'Not to save anything' or if you do, 'Gift' it to your childrens. It sounds redicilous 'not to save anything' but what is the point of saving if you will have to sell your property later on to pay for placement in which you will go?

Yes, we can plan to go to a warmer country where things may be cheap but at some stage, and I can tell you, we all will be suffering from memory issues, balance problem and many other musculoskeletal pathologies. And at that point, you either need 24/7 live in carer to assist you or you go into a placement....

Perhaps, by saving you can have 24/7 live in carer to assist you compared to going into a nursing / residential home...
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      12-24-2012, 10:54 AM   #8
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Not sure what lifestyles your guys are use to, but my parents have just retired, their combined TOTAL pension is 1300 a month, and that is more than enough for them to live on (they have no mortgage). If/when they need more financial help I'm more than happy to step in (after all they worked their whole lives to provide for me).

2400 NET income is the same as a gross of roughly 36K per year, which last time I checked is 10K more than the "average" wage for the UK, hardly a "meagre" amount?
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      12-24-2012, 06:50 PM   #9
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Hmm... so just to put this into perspective, what is the 'maximum amount annually' actually?
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      12-24-2012, 07:03 PM   #10
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Bring it on. That's a grand more than I get for working a month. Can't wait.
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      12-24-2012, 07:06 PM   #11
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Quote:
Originally Posted by Brian mc21 View Post
Bring it on. That's a grand more than I get for working a month. Can't wait.
yes... not quite sure it works like that

Merry Christmas!
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      12-24-2012, 07:11 PM   #12
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Quote:
Originally Posted by BGM View Post
yes... not quite sure it works like that

Merry Christmas!
Well that's my Christmas ruined.
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      12-25-2012, 04:53 AM   #13
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Quote:
Originally Posted by BGM View Post
Hmm... so just to put this into perspective, what is the 'maximum amount annually' actually?
Contributions totalling no more that 50k pa (up to a maximum fund value of 1.5m, which I think reduced at the last budget, any excess is taxed at 50%). Hope you all have a very 'merry' Christmas
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      12-25-2012, 05:56 AM   #14
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If you had a fund of 1m you would get an index linked annuity paying approx 35k p/a or a flat rate 60k p/a. Add sate pension on and you would be a VERY comfortable pensioner.
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      12-25-2012, 06:01 AM   #15
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Quote:
Originally Posted by Bungle009 View Post
If you had a fund of 1m you would get an index linked annuity paying approx 35k p/a or a flat rate 60k p/a. Add sate pension on and you would be a VERY comfortable pensioner.
Indeed I will LOL.
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      12-25-2012, 07:28 AM   #16
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Quote:
Originally Posted by rogerxp View Post
Contributions totalling no more that 50k pa (up to a maximum fund value of 1.5m, which I think reduced at the last budget, any excess is taxed at 50%). Hope you all have a very 'merry' Christmas
Oh god, well in that case we clearly are all fucked
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      12-25-2012, 08:02 AM   #17
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Who do I have to sleep with to boost monthly pay out?
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      12-25-2012, 08:43 AM   #18
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Quote:
Originally Posted by rogerxp View Post
Contributions totalling no more that 50k pa (up to a maximum fund value of 1.5m, which I think reduced at the last budget, any excess is taxed at 50%). Hope you all have a very 'merry' Christmas
Reduced to 40K pa and a pension value of 1.25M at the last budget and an excess taxed at 55% - maybe I should be a financial advisor

Merry Christmas all
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      12-25-2012, 09:49 AM   #19
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I don't think many people can save 40k pa, and if you can get out of this thread

Edited due to typos from my phone

Last edited by BGM; 12-25-2012 at 03:53 PM.
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      12-25-2012, 11:51 AM   #20
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Quote:
Originally Posted by BGM View Post
I don't think may people can save 40k pa, and if you can get out if this thread
+1
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      12-25-2012, 12:59 PM   #21
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Its not the happiest of topics but its strange this has cropped up as its actually on my mind.... To me it does seem that on paper we're not in as good a position as say our/my parents were/are now.

Everything's costing more to run and pension pots are getting hammered in one way or another, I've actually got a full pension review at the end of January to look at where I currently stand(having had a private pension since I was 21 - I'm now 44). Different people will of course have different views on what's needed financially to maintain an existence or lead a comfortable life style after they move on from the 9-5 life. Saving for a rainy day IMO is more difficult again than it once was. I do my best but is it going to be enough? And what is enough?

Healthcare's another issue of course should I need Healthcare in later life again where's the money going to come from.... Very interesting subject this something that over the years will focus the mind..

But on to this very question

Quote:
Originally Posted by A_P View Post
Who do I have to sleep with to boost monthly pay out?
Well one of these two guys would be your target



I'd try the one on the right personally.. he tells the one on the left what's going on apparently .

But if you do go this far you might want to invest in a tube of this cos as we all know its bloody hard work and it'll sure be tight trying to get anything out of one of these guys these days.



Mind you every pension holder should receive a tube of the above as a thank you for having their pensions battered in the way they've gone over the years
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      12-25-2012, 01:02 PM   #22
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Quote:
Originally Posted by BGM View Post
I don't think may people can save 40k pa, and if you can get out if this thread
Not really a Christmas Day subject, but.....

It's not about simply saving 40000 or even 50000 a year into your pension (you wouldn't have to even if you could as any way as tax relief brings down the amount you need to put that much in a pension pot). It effects those of us on final salary pension schemes due to the way that these schemes are valued for tax purposes.

It means that someone who is relatively highly paid (but not necessarly hugely wealthy or affluent ) such as a head teacher, mid ranking police officer, doctor, senior armed forces officers, can find that the value of their DB pension can rise markedly on promotion (well in excess of 50k annually) which can ultimately lead to a big tax bill. This is the unintended consequences ( or maybe it isn't ) of draconian changes to pension rules.

No sympathy required but it is the middle classes who are, yet again, being made to pay whilst those with very high incomes and big wealth who will probably escape....



Edit....Old Grey Steve....good post. I have made investment and pension decisions in very good faith over the last 5 years, the latest 'fiddling' by Mssrs Osbourne and Alexander have made me review every decision I made, the constantly changing pension legislation is unhelpful and undermines confidence in pensions as an investment for retirement, this can only cost the Government more in the long term.

Last edited by peterg1965; 12-25-2012 at 01:08 PM.
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