[Politics] The Labour Government

chip · Oct 10, 2024

My pension fund has heavily invested in UK infrastrucure, Thames Water. I have to take the risk of their investments and in this case they have very much gone down. The tax free lump sump is a way of amielorating this loss. If the investment had been sound, my proportion of the holding would be worth something and tax would be applied when I took any of that gain. Changing this is loose-loose for most people, £100K is not a lot of money compared to a decade ago and will be worth much less in 10 years time. You can't put that much in tax free wrappers so interest income will yield tax too.

chip · Oct 10, 2024

Bodian said:
This whole discussion on the lump sum issue may be possibly misplaced anyway. There doesn't seem to have actually been anything proposed or said by the Government at all. It seems to be an IFS recommendation that hasn't specifically been ruled out - and therefore now being portrayed by some of the media as 'likely'.

That's a classic Blair way of testing the water, surely.

Guinness Boy · Oct 10, 2024

So today we're talking about a c100K reduction in a limit introduced by the Tories that's basically a tax dodge for rich boomers. I really don't know how the country's still functioning.

Curious Orange · Oct 10, 2024

beorhthelm said:
they can rely on it after tax. a pension is supposed to see you through old age, it's peculiar that it's expected we get this one-off payment up front and without tax.

The trouble, and this has been the case for at least the last quarter of a century, is that annuity rates are rubbish. This was certainly the case when I was an annuity administrator back in the late 90's when the maximum TFC was 25% of the pot (depending on the scheme type). Most people back then, irrespective of the size of the pot, took the tax free cash as it didn't make a massive difference to the expected annuity they'd achieve, and a lot of the time they'd been advised to invest the lump sum in bonds as they'd get a better return.

Chicken Run · Oct 10, 2024

Mmm, in the last few days i’ve drawn down the entire amount of 1 of several pensions i have been paying into since the 80’s i got the 25% tax free the rest was taxed on an emergency tax code which i shall claw some back from HMRC

timbha · Oct 10, 2024

Chicken Run said:
Mmm, in the last few days i’ve drawn down the entire amount of 1 of several pensions i have been paying into since the 80’s i got the 25% tax free the rest was taxed on an emergency tax code which i shall claw some back from HMRC

Is this something you had planned to do for a while or a reaction to some press speculation?

Weststander · Oct 10, 2024

Guinness Boy said:
So today we're talking about a c100K reduction in a limit introduced by the Tories that's basically a tax dodge for rich boomers. I really don't know how the country's still functioning.

The BMA are very active just now in openly opposing the reduction from £258k. Large numbers of public sector workers have significant pension pots in defined benefit terms, seeing the current tax free lump sum as further reward for service.

Chicken Run · Oct 10, 2024

timbha said:
Is this something you had planned to do for a while or a reaction to some press speculation?

i activated the complete drawdown on the 19th Sep, the money was in my account 19 days later, way before press speculation

Super Steve Earle · Oct 10, 2024

beorhthelm said:
they can rely on it after tax. a pension is supposed to see you through old age, it's peculiar that it's expected we get this one-off payment up front and without tax.

What if they had pension mortgages and could now find themselves thousands short? Presume you are alright with that too?

chip · Oct 10, 2024

Guinness Boy said:
So today we're talking about a c100K reduction in a limit introduced by the Tories that's basically a tax dodge for rich boomers. I really don't know how the country's still functioning.

That's the spirit, we should all unthinkingly accept our masters infalibility. We must refrain from discussing anything and only proclaim the wisdom of the select few.

Sometimes you speak sense, on matters of politics you sound like this:

Guinness Boy · Oct 10, 2024

chip said:
That's the spirit, we should all unthinkingly accept our masters infalibility. We must refrain from discussing anything and only proclaim the wisdom of the select few.

Sometimes you speak sense, on matters of politics you sound like this:
View attachment 190084

I take it you’re soon to be retiring from higher education on a juicy DB pension?

South Stand Bonfire · Oct 10, 2024

amexer said:
I see new workers rights coming in today. Are employers going to be happy about possibility of having to agree to flexible working from day one.

I don’t think they have to agree to it (yet!). I think any one will have the right to ask for flexible working from Day 1, but it doesn’t have to be agreed to (yet!). Can’t wait to tell my daughter who is in week 6 of her trainee paramedic course. Her working at home will make her work so much less stressful.

beorhthelm · Oct 10, 2024

Super Steve Earle said:
What if they had pension mortgages and could now find themselves thousands short? Presume you are alright with that too?

absolutely yes. literally millions of others aren't able to take such a tax efficient route to mortgage payments, having gone through the silly old route of paying it off before they retire, out of their taxed income.

BrightonCottager · Oct 10, 2024

I cannot understand why any government would reduce the savings pot of pensioners given that we have an aging, unfit population and a creaking care system . My mum is living in a care home and burning through her and my long-dead dad's lifetime savings. It's made me reconsider my priorities about saving. Any significant reduction of pension savings including lump sums will end up with more people relying on publicly funded care.

Super Steve Earle · Oct 10, 2024

beorhthelm said:
absolutely yes. literally millions of others aren't able to take such a tax efficient route to mortgage payments, having gone through the silly old route of paying it off before they retire, out of their taxed income.

Oh dear. So your comments are rooted in envy. Literally millions aren't able to do a lot of things throughout their lives, because we aren't all equal.

Weststander · Oct 10, 2024

BrightonCottager said:
I cannot understand why any government would reduce the savings pot of pensioners given that we have an aging, unfit population and a creaking care system . My mum is living in a care home and burning through her and my long-dead dad's lifetime savings. It's made me reconsider my priorities about saving. Any significant reduction of pension savings including lump sums will end up with more people relying on publicly funded care.

Tangibly and in messaging. The last thing we need is more ‘jam today’ people opting of pension auto enrolment. It’s vital that people even from age 20 save adequately for retirement. The best way is start asap.

chip · Oct 10, 2024

Guinness Boy said:
I take it you’re soon to be retiring from higher education on a juicy DB pension?

Yes, I will have a decent pension. Does that mean I can't have a valid opinion on this? If this bunch of bufoons had actually had a plan, perhaps we wouldn't be in this situation of speculating which group they wish to alienate this time. I think most people are genuinely disappointed, some remain credulous.

chip · Oct 10, 2024

Super Steve Earle said:
Oh dear. So your comments are rooted in envy. Literally millions aren't able to do a lot of things throughout their lives, because we aren't all equal.

fear and envy are powerful weapons.

beorhthelm · Oct 11, 2024

Super Steve Earle said:
Oh dear. So your comments are rooted in envy. Literally millions aren't able to do a lot of things throughout their lives, because we aren't all equal.

oh dear no. my comments are rooted in bewilderment that we sub some well off pensions while others dont see the benefits. public finances are a mess while many are getting tax relief at savings one end and large tax free lumps at the other. to cover this, other people are going to get taxed more.

Guinness Boy · Oct 11, 2024

chip said:
Yes, I will have a decent pension. Does that mean I can't have a valid opinion on this? If this bunch of bufoons had actually had a plan, perhaps we wouldn't be in this situation of speculating which group they wish to alienate this time. I think most people are genuinely disappointed, some remain credulous.

Of course you’re allowed an opinion but it speaks volumes that I guessed your situation.

You can sum up a lot of people on this thread by having them say “please spend more money. No not THEIRS! No not MINE!”

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