If you 'Click here' for terms and conditions it just returns you to this page! Are participants going to be contacted by anyone else?
13:33 on 22 February 2012
Rob Walker:
...ie if you first go to the survey.
13:35 on 22 February 2012
Mike Johnson:
Yes, please could someone from Citywire answer this?
14:37 on 22 February 2012
danny glad:
Rob Walker if you look to the right just above
sine me up you will find terms and conditions
14:51 on 22 February 2012
David Andrews:
"Any personal data which you provide when you enter this competition/survey is governed by Citywire's Terms & Conditions and Privacy Policy"
I feel it is either stupid or deliberately obstructive to have T&C's which then tell you to look somewhere else for important facts i.e. privacy.
15:28 on 22 February 2012
fiona mellor:
Stupid questions too - you don;t have the option of 'none of the above' in terms of the answers so you are forced to pick one. The results will be very skewed as a result!
18:25 on 22 February 2012
Keith Hilton:
Agree with Fiona. Also there's a lack of information in the questions e.g. the amount needed for a given pension will depend on age (if taking an annuity), but does the amount include the state pension too ?
19:01 on 22 February 2012
Pilgrim:
Agree with other comments. Silly questions. Pension income with or without the contribution from the state pension? Level or index linked income? Reasons for saving do not include one of the most obvious ones, i.e. to permit a comfortable life style and reasonable freedom of action in old age. Also to afford the ever increasing real cost of services for the old when these are needed.
01:16 on 23 February 2012
David Andrews:
Hey Citywire !!!!!!!
Why are you so quiet when all the comments arev uniformly negative ? Don't you have anything to say to those who replied to you ?
09:14 on 23 February 2012
Bill lawson:
No matter how much you accrue in your pension you will not be able to get your hands on it when yuo really need it .The value of your pension falls every year ,until stability of wages is achieved you are better off buying something that is easily sold,
09:30 on 23 February 2012
Gavin Lumsden:
Hi everyone, we're sorry if it wasn't clear where to click to see the terms and conditions.
@David Andrews. We've removed the reference to Citywire's privacy policy to simply say that, 'Your answers will remain anonymous and might be used for editorial purposes.'
As whether the questions are silly or not. We're just trying to get a sense of readers' broad attitude to pensions and retirement. It's not a detailed survey but the results could be interesting, hopefully.
Thanks for taking part.
10:59 on 23 February 2012
Rob Guy:
Yup, agree with general comment - just a poor survey - even to get 'a rough idea'
I think i could knock one up in 30mins - CityW, if you need just mail me !!!
11:51 on 23 February 2012
Chris Sullivan:
Just send us the lolly, Lolly, LOL
13:32 on 23 February 2012
Kevin S:
agree with above comments on too vague questions
must be one of the stupidest surveys I have seen
doesn't bode well for even reading Lolly in the future !!
13:38 on 23 February 2012
Martin Jones:
Reply to Bill Lawson., Where you save is key. My wife put her spare cash into AVCs - a complete waste but I have used my full PEP/ISA allowance and have a nice pot producing extra TAX free income or source of capital.
13:40 on 23 February 2012
Mark Lance:
Can anyone help me
18:24 on 23 February 2012
maurice alston:
I'm sad to see so many negative comments about the q'aire. Of course any can be improved and although I have bee a designer of scores of such things in the past, I didn't take exception to the content. As you say, the responses give some idea of peoples concerns etc. Perhaps pensioners and those near to it are generally grumpy (oops, I've said it now! No offence really!!)
15:01 on 24 February 2012
Mark Lance:
Can anyone else help me, I have a bonus coming this year which will take me into the 40% tax mark, I was going to use it to reduce the mortgage and I don't have a pension. As I am 50 would I be right in thinking I could put it all into a pension then draw the lot in 5 yrs with 25% being tax free and the rest being treated as taxable earned income and as its unlikely I will be paying 40% tax I would be better off on both fronts? Thanks in advance
15:11 on 24 February 2012
John Roper:
I am not resident in the EU. I live in Guernsey, Channel Islands and we (thank goodness) are not in the EU.
19:08 on 24 February 2012
Tony Peterson:
Pensions are a confidence trick cooked up by successive crooked governments in collusion with greedy money shufflers who look only to their own percentages.
Apart from paying enough NI contributions for a full SRP, most of us would be far better off in ISAs or just going it alone.
11:38 on 25 February 2012
banjofred:
Spot on Tony
Spot on
10:29 on 26 February 2012
Tony Peterson:
banjofred
You might think I'm spot on, but I don't think Citywire does. For the second time this year a cookie is blocking my receipt of all the fascinating reports Citywire puts out. If you don't hear from me for a while, it isn't that I'm not willing to comment.
14:23 on 26 February 2012
Dreckly:
Banal - the survey, not the comments above.
I was about to type "most readers of this site would expect something better of the CityWire people who commissioned this survey"
"
but decided I might be wrong.
13:26 on 28 February 2012
Dek:
banjofred and Tony Peterson.
I'm afraid I am too tired of repeating the rebuttal to such misguided views BUT how about you ask the millions of retired people with employer sponsored pensions whether they think they have in some way been the victim of a "confidence trick".
Really guys!
You are entitled to your opinion of course and I have no doubt that we can all come up with anecdotes where people have had a really bad pension experience but this is "throwing the baby out with the bathwater" ground. Think about it carefully before you trash a system which has allowed millions of working people in the UK to have a comfortable and much deserved retirement.
13:46 on 28 February 2012
Tony Peterson:
Don't you patronise me, Dek. You are the one with misguided views, and I wonder why. Tell me what you do! I smell a vested interest here.
It just so happens that I am a pensioner, in receipt of full SRP, to which my contributions entitle me. Also in receipt of "gold plated" public service pension based on 6 years contributions. Also in receipt of a private pension I contributed more to than either of the others, which amounted to a scam which dribbles in a trivial extra amount. Which happily I do not depend on.
In all three cases, had I been able to, I would have done better by keeping all my own money during my working life and investing it myself. By far the largest part of my income and security in retirement come from dividends which pay me about three times as much as the sum of my three pensions. Now tell me I am misguided.
But I was through my working life before this century began. I am not concerned about myself but the pensioners of the future. The public servants due to be pauperised by their "changes" to the contract they thought they had. Those who since 2000 have had their private money in crap funds, making negative growth after inflation, and now hammered by derisory annuity rates when their chosen retirement age comes up due for trivial payments which erode from inflation, and the capital and income die with them. People like Manilal Shah who once posted his experiences here.
It is today's pensioners who should be taking to the streets. They've been robbed by a corrupt "industry". Which, I guess, you are part of Dek!!
14:13 on 28 February 2012
Anonymous 2:
How stupid are the questions, they convey nothing to questioner,so what is the reason for the survey, is it to obtain information ? mmm I wonder.
14:22 on 28 February 2012
Brian Richards:
How stupid are the questions, they convey nothing to questioner,so what is the reason for the survey, is it to obtain information ? mmm I wonder.
14:22 on 28 February 2012
Dek:
Dear Tony Patterson.
With far more respect than you seem to be showing me. As I said you are entitled to your opinion - as I am - although you seem to think you have the only valid view.
I am a pension manager (not a salesman, not a banker, not an investment manager, and not a consultant) and have spent well over 30 years trying to help my fellow workers retire on an income most people could not have dreamed of in the 1950s and 60s. I am VERY PROUD of this.
In the most part the industry has been very successful in providing good incomes for those who would listen and if you can't see this I'm afraid you are looking in the wrong place. The rot started when government over regulated in response to high profile criminal actions by people like Robert Maxwell. Over the last 20 years this has managed to make an industry where the compliance with regulations consumes more and more of the funds that should have been used to generate the pension income we are all working for. Schemes have HAD to become risk averse and therefore have limited growth potential.
Remember, as you have a referred to your so called "gold plated" lets have a look at this:
6years so lets say 6/60th of base (pensionable) pay (use £30k salary for ease of calculation and so as not to go for the higher paid/tax brackets).
This would give you a pension of £3,000. At age 60 you would need to have a pot of around £60k to buy this. Assuming a 6% employee contribution the employee/member would pay in £10.8k for this £60k worth of pension. Oh yes, then there is the tax relief, lets say at 20%, therefore the real cost is £8,600 for you £60,000 worth of pension. If you can match this by personal provision in the stock market you should be a very rich man indeed.
Sadly as you say the future won't be this rosy. However, if you have an employer who is prepared to match your pension contributions you WILL make 100% profit on day 1. What after tax saving can you find which will guarantee that sort of return?
I am really sorry if you feel patronised that was not my intent. However facts are facts.
14:58 on 28 February 2012
Tony Peterson:
Dek
How amazing. You have a vested interest and did not declare it when you decided to smear banjofred and myself as "misguided"!
And why should I trust I trust the reliability of your computations when you cannot even copy my name correctly (being unwilling myself to hide behind anonymity like you).
Whether I am a very rich man or not is none of your concern (though I think I am). As you yourself admit the future is bleak for those starting out on pension schemes now. What the hell is the use of an untouchable 100% profit on Day 1 , if when you can access it for the first time, say on Day 11000 it is worth, in real terms, less than you yourself put in in the first place? Which is what is very likely to happen to most of your customers. Do you tell them that, I wonder?
And don't forget, unlike your own investments which you can leave to heirs or charities, your pension, capital and income, dies with you.
15:27 on 28 February 2012
chazza:
Mark Lance Feb 24, 2012 at 15:1
yes, as regulations stand at present. In a similar position, I would do that.
15:30 on 28 February 2012
Dek:
Dear Tony Paterson.
Sorry for putting an extra "t" in your name.
I see. So you are suggesting that anyone that works in the pension industry is corrupt in some way just because they work in the industry are you? And I am the one smearing reputations? If my figures are misleading in any way I am happy for you to state on this public forum where and why they are.
As I said you are entitled to your opinion. So am I. By the way what is your expertise in pension provision on which this view has been based?
Not interested in how rich or not you are I am far more concerned for people who have no provision and are likely never to have any adequate provision if they follow you lead.
Still your choice.
By the by, 25% cash lump sum (none taxable) at retirement of £60k is £15k for your £8.6k
15:48 on 28 February 2012
Dek:
By the way, this 25% cash lump sum (none taxable) at retirement of £60k is £15k for your £8.6k, as I illustrated would still leave you with a pension of around £2,000. Just a thought.
15:55 on 28 February 2012
Tony Peterson:
Dek
You still can't spell my name. Why should I trust your other data?
And you are still talking peanuts.
You are completely avoiding any discussion of the effect of inflation on your products, too. Over my lifetime money has lost 99.7% of its real value. Comparing today's money with some presumed future bonanza is deception that I think you should be prosecuted for. And yes, I am afraid I do think that most of your industry, like cops, politicians and tabloid editors work in corrupt industries. Watch Leveson.
And I do think that it is corrupt for politicians to offer a tax break that forces anxious people into the clutches of fund managers like yourself. You won't like that, because you make a living from the fearful punters. There are, however, other much more efficient ways to secure a prosperous retirement.
Until people can control their own finances they are very unwise to trust fund managers. The management fees usually gobble up any tax break, and inflation destroys what is left when the poor punter retires.
16:10 on 28 February 2012
Dreckly:
I wonder what proportion of people who are saving in to a pension realise that - give or take a bit (age/gender/etc) - a £100K pot currently buys you no more than about £500/month?
16:43 on 28 February 2012
Dek:
Dear Tony Peterson.
Third time lucky.
Oh dear. You are an angry man aren't you!
I can see I am wasting my breath.
BUT FINALLY.
As far as trust is concerned you obviously seem not to trust anyone much outside yourself. If that works for you great!
Myself I have found that most people are deserving of trust and the rouges are relatively few and far between. Call me naive if you like but that is my experience.
I assume from your statement then that you only have 3p of value from every £1 you have saved. Challenging.
By the way I AM NOT A FUND MANAGER and have never sold anything and therefore have no “product”. I rely on the pension the schemes I help support provide as I am a member and it is my provision also.
I stand by my previous statement. I am PROUD to be one of the professionals in the Pension industry who has thought hard over the last 30 year to 40 years to ensure millions of people retire in some comfort.
If anyone is avoiding the real issues it would appear to be you. A very sad world that you live in!
16:51 on 28 February 2012
Dreckly:
My old boss used to say:
"Don't try to teach a pig to sing, it's a waste of time and it annoys the pig"
17:00 on 28 February 2012
Tony Peterson:
Dek
I didn't start saving or investing when I was a baby and I presume you didn't either.
Nor am I angry. I find your posts totally risible, and enjoy them for that quality.
A professional in the pension industry is as respectable as far as I am concerned as a professional in the sex industry, or in the gutter press. Each to his own.
18:42 on 28 February 2012
Dek:
Dreckly.
I see your point.
19:29 on 28 February 2012
Tony Peterson:
Dek
If you had even half an inkling of the world I live in you would know it is a lie to call it sad.
20:34 on 28 February 2012
Mrcassandra:
handbags at dawn then?
11:14 on 29 February 2012
Dek:
Mrcassandra
How right you are. I really should know better at my age now shouldn't I.
Still, if I have raised a smile in my futile exchange it wasn't a total waste now was it!
12:00 on 29 February 2012
vod:
@ Dek & Tony
Respect to you both.
I'm a newby to all this. It crosses my mind that should I ever get that much wealth I sure wouldn't use my time counting or flaunting it here.
Many thanks to you both.
13:25 on 29 February 2012
Dek:
Hi vod.
Hope we haven't put you off. Unfortunately I have no great wealth to flaunt. If I had I wouldn't be on here.
In any event you are more than welcome.
14:10 on 29 February 2012
RBC:
I am a fee based IFA - no targets, no commission, just a flat salary, and often come across people with views like Tony, and it is very depressing. RDR has got its work cut out to improve the image of the industry. Expensive and poor PPP's, high pressure sales techniques, and flat spots/periods in the markets have all contributed to the poor public perception of pensions (‘better in a biscuit tin under the mattress’ scenario).
It is important IMO, for people to balance pension and non pension assets, and of course there are liquidity issues, but the lack of access can of course be a positive and a negative for many. It is hard to argue against the advantages of your employer matching contributions surely? In the right scheme/SIPP you can access the same funds for the same price – in some cases less – than in ISA and the over-riding argument is the same as investing in ISA; the theory of long term exposure to the stock market (i.e.: 30 years +) outperforming cash.
For me the main differences come down to access, admittedly poor annuity rates – although offering a guaranteed income of course, and picking the right scheme. If you want flexibility, are disciplined, and do not any have employer contributions, then it may make sense to prioritise ISA. In an ideal world people will have a bit of both – the principle is saving for the future. Main problem with ISA, a.n.other investment, is of course the temptation to raid it when the car blows up etc…..
16:04 on 29 February 2012
Tony Peterson:
RBC, Dek, et al,
I join in Citywire discussions not because I am angry, nor because I want to boast, but because I think that there are systemic problems that you are all aware of (though in different proportions), and which ought to be addressed. For instance I have been waiting, without success, for someone who can bear witness to their own losses through saving in pension funds over the current century, and recently retired with annuities in the last couple of years. There must be thousands of you totally disappointed people out there. Few are joining in.
I am grateful that Citywire has not blocked my posts which I suspected they had done (for a while, probably because of its own computer glitches) when access had been denied to me.
Let me make it clear.
Our pensioner household had a modest lifetime total of income earned, not only in monetary terms but also in real terms. We now enjoy a six figure income from a seven figure portfolio. It could easily have been a seven figure income from an eight figure portfolio had we opted out of all pension contributions during our working lives, and simply stuck with our own choices for a DIY portfolio of equities, bonds, and rental property.
So RBC, you find it depressing to come across people like me. Let me ask you, as an IFA, when did you last advise a client that the statistically validated safest way to secure their independence in old age was to build up a portfolio of directly held shares? I bet you have never done it. If I am right you really are part of the problem (which should make me depressed). You have no right to criticise me.
I am not angry about this, though, why should I be? I think young people today have every reason to be angry.
18:50 on 29 February 2012
Kenpen2:
Hi Tony,
I've admired your posts for the past three years and today's are well up to scratch. They're maybe a tad too trenchantly expressed for some but I have no doubt you're fundamentally right.
There are a few things I'd say in Dek's defence :
1 : when Dek started out the pensions industry did provide some, perhaps many, people with a decent income in retirement. My mate with a coal board pension for instance has a higher monthly income today than I ever managed as a salaried employee. And today I was talking to another friend who is about to retire aged 55 with a private sector DB pension big enough to allow him to sail himself and four companions across the Atlantic.
2. many of the changes which have led to the present parlous position are, as Dek says, not of his nor his industry's making.
3. you have obviously been an astute investor, but as I've found for myself over the past few years, it ain't easy. Many people could go seriously astray if investing entirely off their own bats. The pensions industry may not deliver the best possible outcomes in retirement but it does offer some safeguards against the worst.
For myself, as an Equitable Life (non-GAR) investor I've had my share of disappointments over the past dozen years. My pension (drawdown) is still enough to have allowed me to retire @ 60 but it's not the life of relative luxury that I was promised at the outset. Fortunately the A-day changes spared me the ignominy of having to buy an annuity.
While I was working I saved the max I possibly could into my pension, and it's still barly adequate. If I'd known then what I do now I'd have followed your good example, ignored the "tax relief on contributions" blandishments and managed my savings myself.
Any youngsters out there ? - mark well the words of Uncle Tony !
BTW, I haven't heard anything from Old Faustus for a year or so : how are things going ?
22:34 on 29 February 2012
Alan's opinion via mobile:
There is no doubt in my mind that for the forseeable future investing in a pension scheme in the hopes of achieving a comfortable retirement is a mug's game. It may have worked for Dek years ago but that's all changed now and your contributions will be used to line many pockets along the way, including the taxman, but all the hapless contributor will be left with is the small change.
Drip feed your contributions instead into a second property instead from day one and history shows that you will be far better off in the end. Plus, it remains under your control at all times.
00:42 on 01 March 2012
Tony Peterson:
Kenpen2
Thanks for your kind words.
As will be evident from my post, I did misunderstand Dek's description of his work.
As will also be evident, RBC has not bothered to answer my question to him. His silence rather proves my point.
While Old Faust has had a busy but very profitable year, the mythical young Faust has sat on his hands. I think he is too busy frolicking with his Margarita. As his portfolio is a subset of his my own real trades, I could cheat by picking out my own most profitable trades and claiming some for YF. In which case he would be well in profit. As it is he is not doing much better the Dumb Investor. However, CG profit taking month has come, so YF may decide to cash in his gains with Glaxo and invest the proceeds and dividends elsewhere, possibly Astrazeneca. I'll let DI know in advance.
Alan's point is valid. I think that for those who can afford savings keeping them under your own control is a far more important strategy than surrendering control for a tax break the value of which you are very likely ever to actually enjoy.
08:08 on 01 March 2012
Dek:
Kenpen2
Thanks for your comments, they are much appreciated.
There is room for more than one view and ultimately each person must have the solution they feel most comfortable with. I may not agree with all your points but then is would be a very boring world if we couldn’t have differing views without being tainted as some sort of charlatan.
My points as you say have held true for many years and we are significantly and increasingly challenged for a solution to future pension provision where the old solutions are no longer available to us.
However, no one has yet demonstrated to me a better way of providing pensions that would fit for the majority of the UK population.
The average working man and women don’t earn enough money to invest in property or have the time and/or expertise to dabble in stocks and shares, bonds, derivatives, etc?
Most find it hard enough to find the rent, or if they are very lucky mortgage, every week.
Solutions MUST be realistic for the majority with the flexibility to cater for a significant minority with more sophisticated needs.
I would ask all too please think about the 90% of the population earning below £45k per household and are struggling to put food on the table.
I would be very happy to consider any alternative investment solution for retirement that addressed the needs of the majority of the population not the financially elite. As it stands the current pension system (mainly Defined Contribution sadly), significantly poorer though it is than the Defined Benefit solutions we have managed to destroy (with the exception to the Public Sector), is better than for example an ISA. This is especially true where you get matched contributions from the employer. We are looking at long term investment here for retirement. There are at least the same fund choices if not better from most GPP providers, investment management fees are often significantly lower, and you get an employer contribution as well as tax relief in and tax relief on 25% of the fund coming out. These are facts not sales patter.
Of course this is all based on the presumption of a level playing field and a significant reduction in the benefit dependency for retirement income in the future. If this does NOT happen I would then agree with your position for the really low earners (i.e. below £20k), that is look for an alternative.
So basically it is back to the Government to get the benefit system in a balance where it makes sense for ordinary working people to save for retirement.
This is my last post on this issue but please think again before suggesting the abandonment of the only current viable savings route for retirement for low earners. Improve yes, amend yes, police yes but let’s be constructive.
10:37 on 01 March 2012
RBC:
Sorry Tony - been busy. Um, I am not a stockbroker so have not, but if I genuinely thought that was best for that indivual I would. I have plenty of clients who I advise in other areas and feel they are suitabily equipped to run their own SIPPs and invest directly into shares etc.... which is fine.
11:35 on 01 March 2012
Anonymous 3:
So much comment, some of it misguided, some of it true.
Lets face it, Tony, the only reason people invest in pensions is for tax relief. If there was no tax relief, pensions would be useless. Therefore if you invested exactly the same amount of money in a pension as you would an ISA, in exactly the same funds/shares, you would come out with a larger pot in a pension due to the tax relief.
Now if you are a higher rate tax payer you get extra 20% back through tax return, what invest can provide that return overnight? and although tax free cash of 25% is an advantage, just as good is if you are a basic rate taxpater in retirement. Higher rate relief now, yet you only pay basic in retirement? Plus your tax free cash.
Unless your employer pays into your pension there is a school of thought that ISA's could be better, as although you dont get tax relief putting money in, you can get 100% access tax free, and the fund its self grows simular. However being able to access ISA early is a disadvantage in my book.
Pension also offer excellent death benefits if you were to die pre retirement, that could also be IHT efficient.
My conclusion if a HRT payer DO NOT ignore pensions
If BRT payer DO NOT ignore if your employer also contributes.
If BRT with no employer scheme you may wish not to do a pension, but dont do nothing.
13:11 on 01 March 2012
Tony Peterson:
Dek
Gratuitous assertions can be gratuitously denied. And I deny your assertion that you know the only viable savings route for retirement for low earners. There are many other alternatives. But there is no point spelling them out for you if you do not intend to engage further.
I note also your use of weasel words. such as "dabbling in stocks and shares". Talk about straw men! A snide put down for what could be better described as "acquiring stakes in the ownership of profitable and necessary businesses". Which certainly beats the many sad alternatives like depositing savings in banks where the combination of low interest rates and inflation makes it totally certain that a saver is going to lose out. Or paying into pension plans with consequences adequately spelled out in earlier posts.
13:18 on 01 March 2012
Dreckly:
Tony,
Ref your post at about 13:18 today, for the vast majority of people who are rubbing along on BRT making ends meet, what are the "... many other alternatives" you refer to?
It's not a rhetorical question I assure you. Nor am I now or ever before been anything whatsoever to do with the pensions/savings/banking industry.
13:42 on 01 March 2012
Dreckly:
Tony,
I was thinking along the lines of how you'd suggest someone who is a BRT, with no pension, could create an extra ongoing income of say, £1,000 a month when they retire at about 65?
13:47 on 01 March 2012
Tony Peterson:
Dreckly
My suggestion would be for every person of working age gradually to build up a stake in their water providers, their electricity providers, their gas providers, etc, and supermarkets. When you are old you will still have to pay their bills and pay to eat. Once your holding pays more in dividends than the amount you are billed for, you are free of that worry up to retirement as well as throughout your old age. (Dividends will most probably at least keep up with all increases due to inflation).
It isn't hard to do. No one else is chiselling their percentages off your hard earned savings. Your savings are under your own control. You will probably make some gains on the way. And you will have investments to pass on. It is no harder to buy shares than it is to open a deposit account. You are likely to be astounded at how much you can grow your assets, compared to some poor sucker in a pension fund, tax breaks notwithstanding.
14:34 on 01 March 2012
Dreckly:
Sounds good to me Tony, thanks. I assume you'd also suggest putting as much as poss of these in to a S&S ISA each year.
14:49 on 01 March 2012
Tony Peterson:
You assume correctly, Dreckly.
15:50 on 01 March 2012
Keith Hilton:
With the constant changes to pension rules, mostly to the individuals disadvantage, I can see why many would wish to avoid them like the plague. Me too.
However, for anyone in a position to 'sacrifice' their salary, the additional contributions from tax saving are hard to beat. It's not just the 20% BRT, but Employers NI (13.8%) & Employees NI (12%). Without going into complicated figures this is going to amount to something in the region of an additional 45%.
While the 25% Tax-Free Lump Sum exists, pensions still seem like a no-brainer for me (I'm over 55) i.e. take the cash, pay tax, get 55% income or put in pension and receive 25% cash plus pension fund of 75%. Sacrificing 25% of income buys 3 times that amount of pension. Even with derisory annuity rates, it would be difficult to achieve the same income on a third of the money.
19:09 on 01 March 2012
Keith Hilton:
I should have said ... Sacrificing 30% income & 2.5 times etc, but yoiu get the point!
19:12 on 01 March 2012
Chris Sullivan:
The average person should first save as much money as they can by investing in an efficient lifestyle i.e. loft and cavity wall insulation (almost 100% free of charge from your utility company). Water savers in toilets, aeraters on taps. PV solar panels if you can afford them or use the green deal when it comes out if you cant. Solar hot water. Buy a new more efficient car. Ensure you change utilities companies once a year, compare house and car insurance once a year. All these cost time and some a bit of money but they all save you money on which you otherwise have paid tax and NI so are as efficient as a pension, your costs per year are less and you can live for longer more comfortably. CONTROLLING YOUR COSTS is better and cheaper than saving in any scheme.
19:30 on 01 March 2012
vod:
@ RBC, Dek,Tony & Co
Tony is quite right about there being something systemicly wrong. Trouble is,
like Tony,most only see it from their own standpoint.When I try to see things from his view I can follow that his financial approach might/does work well for people in his position.
However, I'm not in Tony's situation. I'm one of those whom Tony would like to hear from.Retired over the last few years on a full State Pension, an anuity after just managing to qualify for a tax free lump sum. Tony is right. Anuity rates are terrible.
Fortunately, while working, in an industry which no longer exists here, and with the advice of I F A's we had also taken out small endowments, which then went into funds, which helped through redundancy and on to retirement. A semi, no longer motgaged plus investments which slightly exceed Tony's yearly income from his.We run a couple of old cars too on around 22/24K £ per annum.
With the help of information from City wire ,its forums and the comments of the people like your good selves we hope to be able to improve thing s Thank you all.
The term, flaunt, in my earlier comment is regretted as it turned out to be against the sincere views of someone else as i now believe.
Good grief. Since finding my glasses and typing the foregoing ,things have moved on apace I see.Chris Sullivan makes some relevent points and thank goodness for more balanced views from RBC, Kenpen2 and Dek again .Right. I shall retreat now,to the Bunker..........,and the washing up!
GOOD NIGHT !
21:08 on 01 March 2012
Tony Peterson:
I suppose Chris Grayling would want to label me as Trotskyist. (Though I bet he doesn't know what it means). I don't like kids or dying people or people in pain, or handicapped people, being made to work as slave labourers to pay for the (totally mythical) deficit. My motive in my own contributions to this ongoing discussion is to draw attention to the plight of people coming up to retirement now, in the years after I did. Please note Dek and others. I bear you no malice. As I have rather reluctantly admitted, I'm fortunate.
I am acutely aware that British people younger than me are being forced to pay for things I never paid for, but obtained easily, like degrees. I have perhaps by luck or perhaps by skill, as many of you will have noticed (and some agreed with me, and others disagreed) prospered far more than I think I have deserved. I find it hard to believe that people coming up to retirement in state or private sectors are being dumped upon so grossly now. But anyone born between 1945 and 1960 are being hammered now.
But for individuals trying to make their way through life, you have to assume that the environment is hostile. You should be looking out for bribes, and avoiding them. And that goes for tax relief on pension savings.
22:02 on 01 March 2012
Please use a browser with javascript enabled in order to post a comment
Comments (62)
If you 'Click here' for terms and conditions it just returns you to this page! Are participants going to be contacted by anyone else?
13:33 on 22 February 2012
...ie if you first go to the survey.
13:35 on 22 February 2012
Yes, please could someone from Citywire answer this?
14:37 on 22 February 2012
Rob Walker if you look to the right just above
sine me up you will find terms and conditions
14:51 on 22 February 2012
"Any personal data which you provide when you enter this competition/survey is governed by Citywire's Terms & Conditions and Privacy Policy"
I feel it is either stupid or deliberately obstructive to have T&C's which then tell you to look somewhere else for important facts i.e. privacy.
15:28 on 22 February 2012
Stupid questions too - you don;t have the option of 'none of the above' in terms of the answers so you are forced to pick one. The results will be very skewed as a result!
18:25 on 22 February 2012
Agree with Fiona. Also there's a lack of information in the questions e.g. the amount needed for a given pension will depend on age (if taking an annuity), but does the amount include the state pension too ?
19:01 on 22 February 2012
Agree with other comments. Silly questions. Pension income with or without the contribution from the state pension? Level or index linked income? Reasons for saving do not include one of the most obvious ones, i.e. to permit a comfortable life style and reasonable freedom of action in old age. Also to afford the ever increasing real cost of services for the old when these are needed.
01:16 on 23 February 2012
Hey Citywire !!!!!!!
Why are you so quiet when all the comments arev uniformly negative ? Don't you have anything to say to those who replied to you ?
09:14 on 23 February 2012
No matter how much you accrue in your pension you will not be able to get your hands on it when yuo really need it .The value of your pension falls every year ,until stability of wages is achieved you are better off buying something that is easily sold,
09:30 on 23 February 2012
Hi everyone, we're sorry if it wasn't clear where to click to see the terms and conditions.
@David Andrews. We've removed the reference to Citywire's privacy policy to simply say that, 'Your answers will remain anonymous and might be used for editorial purposes.'
As whether the questions are silly or not. We're just trying to get a sense of readers' broad attitude to pensions and retirement. It's not a detailed survey but the results could be interesting, hopefully.
Thanks for taking part.
10:59 on 23 February 2012
Yup, agree with general comment - just a poor survey - even to get 'a rough idea'
I think i could knock one up in 30mins - CityW, if you need just mail me !!!
11:51 on 23 February 2012
Just send us the lolly, Lolly, LOL
13:32 on 23 February 2012
agree with above comments on too vague questions
must be one of the stupidest surveys I have seen
doesn't bode well for even reading Lolly in the future !!
13:38 on 23 February 2012
Reply to Bill Lawson., Where you save is key. My wife put her spare cash into AVCs - a complete waste but I have used my full PEP/ISA allowance and have a nice pot producing extra TAX free income or source of capital.
13:40 on 23 February 2012
Can anyone help me
18:24 on 23 February 2012
I'm sad to see so many negative comments about the q'aire. Of course any can be improved and although I have bee a designer of scores of such things in the past, I didn't take exception to the content. As you say, the responses give some idea of peoples concerns etc. Perhaps pensioners and those near to it are generally grumpy (oops, I've said it now! No offence really!!)
15:01 on 24 February 2012
Can anyone else help me, I have a bonus coming this year which will take me into the 40% tax mark, I was going to use it to reduce the mortgage and I don't have a pension. As I am 50 would I be right in thinking I could put it all into a pension then draw the lot in 5 yrs with 25% being tax free and the rest being treated as taxable earned income and as its unlikely I will be paying 40% tax I would be better off on both fronts? Thanks in advance
15:11 on 24 February 2012
I am not resident in the EU. I live in Guernsey, Channel Islands and we (thank goodness) are not in the EU.
19:08 on 24 February 2012
Pensions are a confidence trick cooked up by successive crooked governments in collusion with greedy money shufflers who look only to their own percentages.
Apart from paying enough NI contributions for a full SRP, most of us would be far better off in ISAs or just going it alone.
11:38 on 25 February 2012
Spot on Tony
Spot on
10:29 on 26 February 2012
banjofred
You might think I'm spot on, but I don't think Citywire does. For the second time this year a cookie is blocking my receipt of all the fascinating reports Citywire puts out. If you don't hear from me for a while, it isn't that I'm not willing to comment.
14:23 on 26 February 2012
Banal - the survey, not the comments above.
I was about to type "most readers of this site would expect something better of the CityWire people who commissioned this survey"
"
but decided I might be wrong.
13:26 on 28 February 2012
banjofred and Tony Peterson.
I'm afraid I am too tired of repeating the rebuttal to such misguided views BUT how about you ask the millions of retired people with employer sponsored pensions whether they think they have in some way been the victim of a "confidence trick".
Really guys!
You are entitled to your opinion of course and I have no doubt that we can all come up with anecdotes where people have had a really bad pension experience but this is "throwing the baby out with the bathwater" ground. Think about it carefully before you trash a system which has allowed millions of working people in the UK to have a comfortable and much deserved retirement.
13:46 on 28 February 2012
Don't you patronise me, Dek. You are the one with misguided views, and I wonder why. Tell me what you do! I smell a vested interest here.
It just so happens that I am a pensioner, in receipt of full SRP, to which my contributions entitle me. Also in receipt of "gold plated" public service pension based on 6 years contributions. Also in receipt of a private pension I contributed more to than either of the others, which amounted to a scam which dribbles in a trivial extra amount. Which happily I do not depend on.
In all three cases, had I been able to, I would have done better by keeping all my own money during my working life and investing it myself. By far the largest part of my income and security in retirement come from dividends which pay me about three times as much as the sum of my three pensions. Now tell me I am misguided.
But I was through my working life before this century began. I am not concerned about myself but the pensioners of the future. The public servants due to be pauperised by their "changes" to the contract they thought they had. Those who since 2000 have had their private money in crap funds, making negative growth after inflation, and now hammered by derisory annuity rates when their chosen retirement age comes up due for trivial payments which erode from inflation, and the capital and income die with them. People like Manilal Shah who once posted his experiences here.
It is today's pensioners who should be taking to the streets. They've been robbed by a corrupt "industry". Which, I guess, you are part of Dek!!
14:13 on 28 February 2012
How stupid are the questions, they convey nothing to questioner,so what is the reason for the survey, is it to obtain information ? mmm I wonder.
14:22 on 28 February 2012
How stupid are the questions, they convey nothing to questioner,so what is the reason for the survey, is it to obtain information ? mmm I wonder.
14:22 on 28 February 2012
Dear Tony Patterson.
With far more respect than you seem to be showing me. As I said you are entitled to your opinion - as I am - although you seem to think you have the only valid view.
I am a pension manager (not a salesman, not a banker, not an investment manager, and not a consultant) and have spent well over 30 years trying to help my fellow workers retire on an income most people could not have dreamed of in the 1950s and 60s. I am VERY PROUD of this.
In the most part the industry has been very successful in providing good incomes for those who would listen and if you can't see this I'm afraid you are looking in the wrong place. The rot started when government over regulated in response to high profile criminal actions by people like Robert Maxwell. Over the last 20 years this has managed to make an industry where the compliance with regulations consumes more and more of the funds that should have been used to generate the pension income we are all working for. Schemes have HAD to become risk averse and therefore have limited growth potential.
Remember, as you have a referred to your so called "gold plated" lets have a look at this:
6years so lets say 6/60th of base (pensionable) pay (use £30k salary for ease of calculation and so as not to go for the higher paid/tax brackets).
This would give you a pension of £3,000. At age 60 you would need to have a pot of around £60k to buy this. Assuming a 6% employee contribution the employee/member would pay in £10.8k for this £60k worth of pension. Oh yes, then there is the tax relief, lets say at 20%, therefore the real cost is £8,600 for you £60,000 worth of pension. If you can match this by personal provision in the stock market you should be a very rich man indeed.
Sadly as you say the future won't be this rosy. However, if you have an employer who is prepared to match your pension contributions you WILL make 100% profit on day 1. What after tax saving can you find which will guarantee that sort of return?
I am really sorry if you feel patronised that was not my intent. However facts are facts.
14:58 on 28 February 2012
Dek
How amazing. You have a vested interest and did not declare it when you decided to smear banjofred and myself as "misguided"!
And why should I trust I trust the reliability of your computations when you cannot even copy my name correctly (being unwilling myself to hide behind anonymity like you).
Whether I am a very rich man or not is none of your concern (though I think I am). As you yourself admit the future is bleak for those starting out on pension schemes now. What the hell is the use of an untouchable 100% profit on Day 1 , if when you can access it for the first time, say on Day 11000 it is worth, in real terms, less than you yourself put in in the first place? Which is what is very likely to happen to most of your customers. Do you tell them that, I wonder?
And don't forget, unlike your own investments which you can leave to heirs or charities, your pension, capital and income, dies with you.
15:27 on 28 February 2012
Mark Lance Feb 24, 2012 at 15:1
yes, as regulations stand at present. In a similar position, I would do that.
15:30 on 28 February 2012
Dear Tony Paterson.
Sorry for putting an extra "t" in your name.
I see. So you are suggesting that anyone that works in the pension industry is corrupt in some way just because they work in the industry are you? And I am the one smearing reputations? If my figures are misleading in any way I am happy for you to state on this public forum where and why they are.
As I said you are entitled to your opinion. So am I. By the way what is your expertise in pension provision on which this view has been based?
Not interested in how rich or not you are I am far more concerned for people who have no provision and are likely never to have any adequate provision if they follow you lead.
Still your choice.
By the by, 25% cash lump sum (none taxable) at retirement of £60k is £15k for your £8.6k
15:48 on 28 February 2012
By the way, this 25% cash lump sum (none taxable) at retirement of £60k is £15k for your £8.6k, as I illustrated would still leave you with a pension of around £2,000. Just a thought.
15:55 on 28 February 2012
Dek
You still can't spell my name. Why should I trust your other data?
And you are still talking peanuts.
You are completely avoiding any discussion of the effect of inflation on your products, too. Over my lifetime money has lost 99.7% of its real value. Comparing today's money with some presumed future bonanza is deception that I think you should be prosecuted for. And yes, I am afraid I do think that most of your industry, like cops, politicians and tabloid editors work in corrupt industries. Watch Leveson.
And I do think that it is corrupt for politicians to offer a tax break that forces anxious people into the clutches of fund managers like yourself. You won't like that, because you make a living from the fearful punters. There are, however, other much more efficient ways to secure a prosperous retirement.
Until people can control their own finances they are very unwise to trust fund managers. The management fees usually gobble up any tax break, and inflation destroys what is left when the poor punter retires.
16:10 on 28 February 2012
I wonder what proportion of people who are saving in to a pension realise that - give or take a bit (age/gender/etc) - a £100K pot currently buys you no more than about £500/month?
16:43 on 28 February 2012
Dear Tony Peterson.
Third time lucky.
Oh dear. You are an angry man aren't you!
I can see I am wasting my breath.
BUT FINALLY.
As far as trust is concerned you obviously seem not to trust anyone much outside yourself. If that works for you great!
Myself I have found that most people are deserving of trust and the rouges are relatively few and far between. Call me naive if you like but that is my experience.
I assume from your statement then that you only have 3p of value from every £1 you have saved. Challenging.
By the way I AM NOT A FUND MANAGER and have never sold anything and therefore have no “product”. I rely on the pension the schemes I help support provide as I am a member and it is my provision also.
I stand by my previous statement. I am PROUD to be one of the professionals in the Pension industry who has thought hard over the last 30 year to 40 years to ensure millions of people retire in some comfort.
If anyone is avoiding the real issues it would appear to be you. A very sad world that you live in!
16:51 on 28 February 2012
My old boss used to say:
"Don't try to teach a pig to sing, it's a waste of time and it annoys the pig"
17:00 on 28 February 2012
Dek
I didn't start saving or investing when I was a baby and I presume you didn't either.
Nor am I angry. I find your posts totally risible, and enjoy them for that quality.
A professional in the pension industry is as respectable as far as I am concerned as a professional in the sex industry, or in the gutter press. Each to his own.
18:42 on 28 February 2012
Dreckly.
I see your point.
19:29 on 28 February 2012
Dek
If you had even half an inkling of the world I live in you would know it is a lie to call it sad.
20:34 on 28 February 2012
handbags at dawn then?
11:14 on 29 February 2012
Mrcassandra
How right you are. I really should know better at my age now shouldn't I.
Still, if I have raised a smile in my futile exchange it wasn't a total waste now was it!
12:00 on 29 February 2012
@ Dek & Tony
Respect to you both.
I'm a newby to all this. It crosses my mind that should I ever get that much wealth I sure wouldn't use my time counting or flaunting it here.
Many thanks to you both.
13:25 on 29 February 2012
Hi vod.
Hope we haven't put you off. Unfortunately I have no great wealth to flaunt. If I had I wouldn't be on here.
In any event you are more than welcome.
14:10 on 29 February 2012
I am a fee based IFA - no targets, no commission, just a flat salary, and often come across people with views like Tony, and it is very depressing. RDR has got its work cut out to improve the image of the industry. Expensive and poor PPP's, high pressure sales techniques, and flat spots/periods in the markets have all contributed to the poor public perception of pensions (‘better in a biscuit tin under the mattress’ scenario).
It is important IMO, for people to balance pension and non pension assets, and of course there are liquidity issues, but the lack of access can of course be a positive and a negative for many. It is hard to argue against the advantages of your employer matching contributions surely? In the right scheme/SIPP you can access the same funds for the same price – in some cases less – than in ISA and the over-riding argument is the same as investing in ISA; the theory of long term exposure to the stock market (i.e.: 30 years +) outperforming cash.
For me the main differences come down to access, admittedly poor annuity rates – although offering a guaranteed income of course, and picking the right scheme. If you want flexibility, are disciplined, and do not any have employer contributions, then it may make sense to prioritise ISA. In an ideal world people will have a bit of both – the principle is saving for the future. Main problem with ISA, a.n.other investment, is of course the temptation to raid it when the car blows up etc…..
16:04 on 29 February 2012
RBC, Dek, et al,
I join in Citywire discussions not because I am angry, nor because I want to boast, but because I think that there are systemic problems that you are all aware of (though in different proportions), and which ought to be addressed. For instance I have been waiting, without success, for someone who can bear witness to their own losses through saving in pension funds over the current century, and recently retired with annuities in the last couple of years. There must be thousands of you totally disappointed people out there. Few are joining in.
I am grateful that Citywire has not blocked my posts which I suspected they had done (for a while, probably because of its own computer glitches) when access had been denied to me.
Let me make it clear.
Our pensioner household had a modest lifetime total of income earned, not only in monetary terms but also in real terms. We now enjoy a six figure income from a seven figure portfolio. It could easily have been a seven figure income from an eight figure portfolio had we opted out of all pension contributions during our working lives, and simply stuck with our own choices for a DIY portfolio of equities, bonds, and rental property.
So RBC, you find it depressing to come across people like me. Let me ask you, as an IFA, when did you last advise a client that the statistically validated safest way to secure their independence in old age was to build up a portfolio of directly held shares? I bet you have never done it. If I am right you really are part of the problem (which should make me depressed). You have no right to criticise me.
I am not angry about this, though, why should I be? I think young people today have every reason to be angry.
18:50 on 29 February 2012
Hi Tony,
I've admired your posts for the past three years and today's are well up to scratch. They're maybe a tad too trenchantly expressed for some but I have no doubt you're fundamentally right.
There are a few things I'd say in Dek's defence :
1 : when Dek started out the pensions industry did provide some, perhaps many, people with a decent income in retirement. My mate with a coal board pension for instance has a higher monthly income today than I ever managed as a salaried employee. And today I was talking to another friend who is about to retire aged 55 with a private sector DB pension big enough to allow him to sail himself and four companions across the Atlantic.
2. many of the changes which have led to the present parlous position are, as Dek says, not of his nor his industry's making.
3. you have obviously been an astute investor, but as I've found for myself over the past few years, it ain't easy. Many people could go seriously astray if investing entirely off their own bats. The pensions industry may not deliver the best possible outcomes in retirement but it does offer some safeguards against the worst.
For myself, as an Equitable Life (non-GAR) investor I've had my share of disappointments over the past dozen years. My pension (drawdown) is still enough to have allowed me to retire @ 60 but it's not the life of relative luxury that I was promised at the outset. Fortunately the A-day changes spared me the ignominy of having to buy an annuity.
While I was working I saved the max I possibly could into my pension, and it's still barly adequate. If I'd known then what I do now I'd have followed your good example, ignored the "tax relief on contributions" blandishments and managed my savings myself.
Any youngsters out there ? - mark well the words of Uncle Tony !
BTW, I haven't heard anything from Old Faustus for a year or so : how are things going ?
22:34 on 29 February 2012
There is no doubt in my mind that for the forseeable future investing in a pension scheme in the hopes of achieving a comfortable retirement is a mug's game. It may have worked for Dek years ago but that's all changed now and your contributions will be used to line many pockets along the way, including the taxman, but all the hapless contributor will be left with is the small change.
Drip feed your contributions instead into a second property instead from day one and history shows that you will be far better off in the end. Plus, it remains under your control at all times.
00:42 on 01 March 2012
Kenpen2
Thanks for your kind words.
As will be evident from my post, I did misunderstand Dek's description of his work.
As will also be evident, RBC has not bothered to answer my question to him. His silence rather proves my point.
While Old Faust has had a busy but very profitable year, the mythical young Faust has sat on his hands. I think he is too busy frolicking with his Margarita. As his portfolio is a subset of his my own real trades, I could cheat by picking out my own most profitable trades and claiming some for YF. In which case he would be well in profit. As it is he is not doing much better the Dumb Investor. However, CG profit taking month has come, so YF may decide to cash in his gains with Glaxo and invest the proceeds and dividends elsewhere, possibly Astrazeneca. I'll let DI know in advance.
Alan's point is valid. I think that for those who can afford savings keeping them under your own control is a far more important strategy than surrendering control for a tax break the value of which you are very likely ever to actually enjoy.
08:08 on 01 March 2012
Kenpen2
Thanks for your comments, they are much appreciated.
There is room for more than one view and ultimately each person must have the solution they feel most comfortable with. I may not agree with all your points but then is would be a very boring world if we couldn’t have differing views without being tainted as some sort of charlatan.
My points as you say have held true for many years and we are significantly and increasingly challenged for a solution to future pension provision where the old solutions are no longer available to us.
However, no one has yet demonstrated to me a better way of providing pensions that would fit for the majority of the UK population.
The average working man and women don’t earn enough money to invest in property or have the time and/or expertise to dabble in stocks and shares, bonds, derivatives, etc?
Most find it hard enough to find the rent, or if they are very lucky mortgage, every week.
Solutions MUST be realistic for the majority with the flexibility to cater for a significant minority with more sophisticated needs.
I would ask all too please think about the 90% of the population earning below £45k per household and are struggling to put food on the table.
I would be very happy to consider any alternative investment solution for retirement that addressed the needs of the majority of the population not the financially elite. As it stands the current pension system (mainly Defined Contribution sadly), significantly poorer though it is than the Defined Benefit solutions we have managed to destroy (with the exception to the Public Sector), is better than for example an ISA. This is especially true where you get matched contributions from the employer. We are looking at long term investment here for retirement. There are at least the same fund choices if not better from most GPP providers, investment management fees are often significantly lower, and you get an employer contribution as well as tax relief in and tax relief on 25% of the fund coming out. These are facts not sales patter.
Of course this is all based on the presumption of a level playing field and a significant reduction in the benefit dependency for retirement income in the future. If this does NOT happen I would then agree with your position for the really low earners (i.e. below £20k), that is look for an alternative.
So basically it is back to the Government to get the benefit system in a balance where it makes sense for ordinary working people to save for retirement.
This is my last post on this issue but please think again before suggesting the abandonment of the only current viable savings route for retirement for low earners. Improve yes, amend yes, police yes but let’s be constructive.
10:37 on 01 March 2012
Sorry Tony - been busy. Um, I am not a stockbroker so have not, but if I genuinely thought that was best for that indivual I would. I have plenty of clients who I advise in other areas and feel they are suitabily equipped to run their own SIPPs and invest directly into shares etc.... which is fine.
11:35 on 01 March 2012
So much comment, some of it misguided, some of it true.
Lets face it, Tony, the only reason people invest in pensions is for tax relief. If there was no tax relief, pensions would be useless. Therefore if you invested exactly the same amount of money in a pension as you would an ISA, in exactly the same funds/shares, you would come out with a larger pot in a pension due to the tax relief.
Now if you are a higher rate tax payer you get extra 20% back through tax return, what invest can provide that return overnight? and although tax free cash of 25% is an advantage, just as good is if you are a basic rate taxpater in retirement. Higher rate relief now, yet you only pay basic in retirement? Plus your tax free cash.
Unless your employer pays into your pension there is a school of thought that ISA's could be better, as although you dont get tax relief putting money in, you can get 100% access tax free, and the fund its self grows simular. However being able to access ISA early is a disadvantage in my book.
Pension also offer excellent death benefits if you were to die pre retirement, that could also be IHT efficient.
My conclusion if a HRT payer DO NOT ignore pensions
If BRT payer DO NOT ignore if your employer also contributes.
If BRT with no employer scheme you may wish not to do a pension, but dont do nothing.
13:11 on 01 March 2012
Dek
Gratuitous assertions can be gratuitously denied. And I deny your assertion that you know the only viable savings route for retirement for low earners. There are many other alternatives. But there is no point spelling them out for you if you do not intend to engage further.
I note also your use of weasel words. such as "dabbling in stocks and shares". Talk about straw men! A snide put down for what could be better described as "acquiring stakes in the ownership of profitable and necessary businesses". Which certainly beats the many sad alternatives like depositing savings in banks where the combination of low interest rates and inflation makes it totally certain that a saver is going to lose out. Or paying into pension plans with consequences adequately spelled out in earlier posts.
13:18 on 01 March 2012
Tony,
Ref your post at about 13:18 today, for the vast majority of people who are rubbing along on BRT making ends meet, what are the "... many other alternatives" you refer to?
It's not a rhetorical question I assure you. Nor am I now or ever before been anything whatsoever to do with the pensions/savings/banking industry.
13:42 on 01 March 2012
Tony,
I was thinking along the lines of how you'd suggest someone who is a BRT, with no pension, could create an extra ongoing income of say, £1,000 a month when they retire at about 65?
13:47 on 01 March 2012
Dreckly
My suggestion would be for every person of working age gradually to build up a stake in their water providers, their electricity providers, their gas providers, etc, and supermarkets. When you are old you will still have to pay their bills and pay to eat. Once your holding pays more in dividends than the amount you are billed for, you are free of that worry up to retirement as well as throughout your old age. (Dividends will most probably at least keep up with all increases due to inflation).
It isn't hard to do. No one else is chiselling their percentages off your hard earned savings. Your savings are under your own control. You will probably make some gains on the way. And you will have investments to pass on. It is no harder to buy shares than it is to open a deposit account. You are likely to be astounded at how much you can grow your assets, compared to some poor sucker in a pension fund, tax breaks notwithstanding.
14:34 on 01 March 2012
Sounds good to me Tony, thanks. I assume you'd also suggest putting as much as poss of these in to a S&S ISA each year.
14:49 on 01 March 2012
You assume correctly, Dreckly.
15:50 on 01 March 2012
With the constant changes to pension rules, mostly to the individuals disadvantage, I can see why many would wish to avoid them like the plague. Me too.
However, for anyone in a position to 'sacrifice' their salary, the additional contributions from tax saving are hard to beat. It's not just the 20% BRT, but Employers NI (13.8%) & Employees NI (12%). Without going into complicated figures this is going to amount to something in the region of an additional 45%.
While the 25% Tax-Free Lump Sum exists, pensions still seem like a no-brainer for me (I'm over 55) i.e. take the cash, pay tax, get 55% income or put in pension and receive 25% cash plus pension fund of 75%. Sacrificing 25% of income buys 3 times that amount of pension. Even with derisory annuity rates, it would be difficult to achieve the same income on a third of the money.
19:09 on 01 March 2012
I should have said ... Sacrificing 30% income & 2.5 times etc, but yoiu get the point!
19:12 on 01 March 2012
The average person should first save as much money as they can by investing in an efficient lifestyle i.e. loft and cavity wall insulation (almost 100% free of charge from your utility company). Water savers in toilets, aeraters on taps. PV solar panels if you can afford them or use the green deal when it comes out if you cant. Solar hot water. Buy a new more efficient car. Ensure you change utilities companies once a year, compare house and car insurance once a year. All these cost time and some a bit of money but they all save you money on which you otherwise have paid tax and NI so are as efficient as a pension, your costs per year are less and you can live for longer more comfortably. CONTROLLING YOUR COSTS is better and cheaper than saving in any scheme.
19:30 on 01 March 2012
@ RBC, Dek,Tony & Co
Tony is quite right about there being something systemicly wrong. Trouble is,
like Tony,most only see it from their own standpoint.When I try to see things from his view I can follow that his financial approach might/does work well for people in his position.
However, I'm not in Tony's situation. I'm one of those whom Tony would like to hear from.Retired over the last few years on a full State Pension, an anuity after just managing to qualify for a tax free lump sum. Tony is right. Anuity rates are terrible.
Fortunately, while working, in an industry which no longer exists here, and with the advice of I F A's we had also taken out small endowments, which then went into funds, which helped through redundancy and on to retirement. A semi, no longer motgaged plus investments which slightly exceed Tony's yearly income from his.We run a couple of old cars too on around 22/24K £ per annum.
With the help of information from City wire ,its forums and the comments of the people like your good selves we hope to be able to improve thing s Thank you all.
The term, flaunt, in my earlier comment is regretted as it turned out to be against the sincere views of someone else as i now believe.
Good grief. Since finding my glasses and typing the foregoing ,things have moved on apace I see.Chris Sullivan makes some relevent points and thank goodness for more balanced views from RBC, Kenpen2 and Dek again .Right. I shall retreat now,to the Bunker..........,and the washing up!
GOOD NIGHT !
21:08 on 01 March 2012
I suppose Chris Grayling would want to label me as Trotskyist. (Though I bet he doesn't know what it means). I don't like kids or dying people or people in pain, or handicapped people, being made to work as slave labourers to pay for the (totally mythical) deficit. My motive in my own contributions to this ongoing discussion is to draw attention to the plight of people coming up to retirement now, in the years after I did. Please note Dek and others. I bear you no malice. As I have rather reluctantly admitted, I'm fortunate.
I am acutely aware that British people younger than me are being forced to pay for things I never paid for, but obtained easily, like degrees. I have perhaps by luck or perhaps by skill, as many of you will have noticed (and some agreed with me, and others disagreed) prospered far more than I think I have deserved. I find it hard to believe that people coming up to retirement in state or private sectors are being dumped upon so grossly now. But anyone born between 1945 and 1960 are being hammered now.
But for individuals trying to make their way through life, you have to assume that the environment is hostile. You should be looking out for bribes, and avoiding them. And that goes for tax relief on pension savings.
22:02 on 01 March 2012
Please use a browser with javascript enabled in order to post a comment