Have you saved enough money for your retirement?

[SussexHoop]

I'm one of the lucky few with a Final Salary scheme. I think I'm right in saying that they can't stop me having that, only stop new employees getting it (Which I think they have already done - Tony Le Mesmer will know better than me, working in our Finance Dept!).

I wouldn't be quite so certain about that. I believe a company can wind a pension scheme up and if they do that, their first priority is to look after existing pensioners. If there is anything left, they then start to look at the remaining members of the scheme although I don't know how they split the pot at that point.

I used to work for a FTSE 100 company. When I joined (some time ago), it was a non-contributory final salary scheme so when I left, my pension benefits were frozen and now increase at a rate of between 3% and 5% pa until I retire (assuming they don't wind the scheme up of course!). They closed the scheme to new entrants some years ago and have recently changed it so that existing members now have to contribute if they want to remain in the scheme. For some people, those contributions are quite high.

If my memory serves me well, the company had quite a few years when stocks and shares were performing well where they didn't have to contribute to the scheme as it was deemed to be overfunded. They don't seem to want to make up for that now!

A friend once told me he'd stopped paying into his pension because he had a 2 year period where he'd paid money in, the stock market had risen and the value of his fund had fallen.

Imho, pension schemes are a rip-off ...

1) you pay the premiums
2) the salesman gets his commission
3) the people who invest the money (wisely or otherwise) get their management charges out of your fund with no comeback if they make poor decisions.
4) if you end up in financial trouble, you can't touch your fund ... you could lose your home but you're not allowed to use your pension fund to rescue the situation.
5) if you and your other half don't actually have a long and healthy retirement, the insurance company makes even more out of you.

If on the other hand, you make your own provision for your retirement ...

1) there is no commission for a salesman,
2) if the investment decisions are poor, it's down to you.
3) if you end up in financial trouble, you could use your pension fund to bail you out
4) if you dont have a long and healthy retirement, you've got something else to leave to your kids.

 

[unnameable]

What's the point in saving for a pension that I may not live to draw, especially if the retirement age is increased to seventy, as has been proposed, the present system being considered unsustainable?
I'm with Rupert Brooke on this one: "Live fast, die young, and make a beautiful corpse."
I would hate to die mid-season, though. Imagine dying not knowing where Albion finished in the league. A summer death would do nicely.

 

[Hungry Joe.]

A summer death would do nicely.

Watch Wimbledon for more than three days, that'll do it.

I have a phobia of dying in my sleep. I want to know when I'm going so I can say something profound.

 

[Soton Seagull]

I have a final slary Pension, worth their weight in gold, yet I hate my job. Now there's a Countdown Conundrum!

 

[3gulls]

No lost most of mine when a Group i was working for want bust!

 

[Cian]

My "saving for my retirement" is a case of hoping I can manage to pass the Irish language requirement to get into the Local Government IT Division (which is entirely in Dublin and not being decentralised, weirdly) - got a guaranteed job there if I can get past the tests. In that case you get 1/3 to 2/3 of your final salary (depending on years served, up to 40) when you retire, and 2/3 of the increases - e.g., sorted.

If not, I'll be screwed. But its over 40 years time away anyway....

 

[Cian]

Oh, forgot to add that the Civil Service pension is "free" - you lose some level of the Irish National Insurance health benifits for the time you work for them for, but its worth it, considering you get subsidised private health insurance off the Civil Service anyway...

 

[The Great Cornholio]

I wouldn't be quite so certain about that. I believe a company can wind a pension scheme up and if they do that, their first priority is to look after existing pensioners. If there is anything left, they then start to look at the remaining members of the scheme although I don't know how they split the pot at that point.

I used to work for a FTSE 100 company. When I joined (some time ago), it was a non-contributory final salary scheme so when I left, my pension benefits were frozen and now increase at a rate of between 3% and 5% pa until I retire (assuming they don't wind the scheme up of course!). They closed the scheme to new entrants some years ago and have recently changed it so that existing members now have to contribute if they want to remain in the scheme. For some people, those contributions are quite high.

If my memory serves me well, the company had quite a few years when stocks and shares were performing well where they didn't have to contribute to the scheme as it was deemed to be overfunded. They don't seem to want to make up for that now!

A friend once told me he'd stopped paying into his pension because he had a 2 year period where he'd paid money in, the stock market had risen and the value of his fund had fallen.

Imho, pension schemes are a rip-off ...

1) you pay the premiums
2) the salesman gets his commission
3) the people who invest the money (wisely or otherwise) get their management charges out of your fund with no comeback if they make poor decisions.
4) if you end up in financial trouble, you can't touch your fund ... you could lose your home but you're not allowed to use your pension fund to rescue the situation.
5) if you and your other half don't actually have a long and healthy retirement, the insurance company makes even more out of you.

If on the other hand, you make your own provision for your retirement ...

1) there is no commission for a salesman,
2) if the investment decisions are poor, it's down to you.
3) if you end up in financial trouble, you could use your pension fund to bail you out
4) if you dont have a long and healthy retirement, you've got something else to leave to your kids.

I think there would be an outcry if the Audit Commission did that! Wouldn't put anything past them though. Very much do as I say, not as I do.

 

[The Great Cornholio]

What's the point in saving for a pension that I may not live to draw, especially if the retirement age is increased to seventy, as has been proposed, the present system being considered unsustainable?
I'm with Rupert Brooke on this one: "Live fast, die young, and make a beautiful corpse."
I would hate to die mid-season, though. Imagine dying not knowing where Albion finished in the league. A summer death would do nicely.

Same reason you have car insurance but probably don't use it. That's life, kid!

 

[Yorkie]

What happens to the pensions of people who die before 65? There must be a fair few of them.

If they are married their partner gets half for life.

I am due to retire in 3 years 10 months.
Before I married I didn't have access to any pension savings schemes although by paying 'full stamp' I was paying towards my own State pension.

When I had children I gave up work (part time work was extremely rare in the early 70's) but my State pension was protected by the fact that I had received Child benefit.

I went back to work in 1977 and started paying 'full stamp' after a year as opposed to married womens stamp which was a concession from the Government and priced at 4p. For some reason I had a desire to get a State pension in my own right and not on my husband's contributions.

I wanted to join the company final pension scheme but was refused because part timers were not entitled to join (I was working 20 hours a week)
In 1988 I went full time with the same company and was then eligible to join the pension scheme and so opted out of the SERPS.

I was made redundant in 2002 and my pension kicked in straightaway because I was 54 (anyone over the age of 50 is entitled) so I have been receiving my Electricity Supply Industry pension for 2 years now.
In 1995 Unison asked all partimers who had been refused a pension to contact them as they were going to do a test case using sex discrimination as the test.

Two months ago I was awarded another 5 years of that pension as we had won our case (me and 1000 others) I had to make a contribution towards my share but with the payout and interest I was £2K better off.
I will also get a State pension in my own right in 4 years time.

The best protection for my old age though is my toyboy husband who will be in full time work until I am 85

 

[Braders]

nope , haven't even started a pension plan yet

thanks for reminding me

 

[m20gull]

I wouldn't be quite so certain about that. I believe a company can wind a pension scheme up and if they do that, their first priority is to look after existing pensioners. If there is anything left, they then start to look at the remaining members of the scheme although I don't know how they split the pot at that point.

Since last year a company winding up a pension scheme of its own free will (not if the company goes bust) now has to GUARANTEE final salary pensions by buying an annuity for all members, whether in receipt of pension or not.

If the Company goes bust, then the old situation applies. Pensioners get money first (but no future increases to that pension), then everyone else in proportion to their interest in the fund (broadly a function of salary, service and age) before the balance is used to provide future increases, firstly to pensioners then the rest.

From 2006 when the PPF kicks in, employers with FSPs will pay a levy to protect every member of a scheme that starts winding up to ensure their benefits are guaranteed.

The Government is currently considering the Financial Assistance Scheme to protect people falling in to the middle bracket. Dexion and AWS are the two cases that have caused most outcry.

 

[m20gull]

Imho, pension schemes are a rip-off ...

1) you pay the premiums
2) the salesman gets his commission
3) the people who invest the money (wisely or otherwise) get their management charges out of your fund with no comeback if they make poor decisions.
4) if you end up in financial trouble, you can't touch your fund ... you could lose your home but you're not allowed to use your pension fund to rescue the situation.
5) if you and your other half don't actually have a long and healthy retirement, the insurance company makes even more out of you.

1) with a company scheme you probably only pay about a third of the premiums
2) of course. The state insists you are advised by a trained competent adviser. Would you do difficult regulated work for no pay?
3) They have comeback - you take your money elsewhere. That's why there is so strong a herd instinct in pension fund investment
4)the state pays you, in the form of tax incentive, to put money aside for your retirement. If you want access to it fine, just don't take the incentive.
5) nope, biggest myth in pensions - it goes to the other pensioners

 

[Yorkie]

re: 5 There will be a death benefit which would go to your next of kin.

 

[Dover]

Having been a nurse for the past seven years I should be OK. I also transferred a previous pension into the NHS fund as per the advice I recived.

 

[NMH]

I am going to SELL myself to a very rich woman who can afford the style of life I require, and service her at intervals to keep things happy.

A lot of tarts would pay big for a sincere and well-founded person like me

 

[oapdodge]

No.

 

[fatboy]

If they are married their partner gets half for life.

What is to stop me now marrying a very old age pensioner with not much life left in her and claiming half her pension for the rest of my life?

 

[Curious Orange]

5) nope, biggest myth in pensions - it goes to the other pensioners

I used to work as an Annuity Administrator, and can confirm that it isn't uncommon for Annuitants, over the course of the policy, to receive more in payments than the value of the pension pot when it was vested. It should be noted that premiums are invested in Government Gilt Bonds and the return isn't that high on them.

I'm currently not paying into a pension scheme, and haven't been since I was made redundant a year and a half ago. Prior to that I was fortunate enough to be in a defined benefits scheme for about five years. I need to jump on the pension bandwagon within the next year I think - once I've decided what I'm going to do workwise.

 

[CHAPPERS]

What is to stop me now marrying a very old age pensioner with not much life left in her and claiming half her pension for the rest of my life?

The fact that you are so damn UGLY that even a very old pensioner wouldn't marry you?