[Finance] Pensions and the Triple Lock.

[Leekbrookgull]

For most of us in the U/K after 35 years of work you should have qualified for your state pension but 35 years of work and say starting work at 14/15/16 you will only be in your early 50,s and maybe still working and paying NIC yet your pension is only paid out at 66 at the moment. So in that 15 year gap what would happen if any government gave you the option of still paying NIC to the government of the day until pension age or allowing you to invest in your own private pension plan ?

 

[Seagull on the Hill]

The money that you pay in Tax and NIC isn't invested to pay your future pension, it pays the pensions of those currently eligible.
If you were allowed to opt out, what would the government use instead?

 

[Carlos BC]

NI contributions don't only go towards paying state pensions. If NI contributions were stopped or paid into private pensions after 35 years of contributions then whatever that amount is would not be in the government coffers - meaning that tax elsewhere would need to rise to pay for things such as state pensions.

 

[Weststander]

70 years ago Nye Bevan, the founder of the NHS, admitted: "The great secret about the National Insurance Fund is that there ain't no fund."


Demographically/actuarially, whatever pension funding you look at (state or private), always bear in mind that in essence a working career needs to finance retired life. In overall terms.

If average starting work age with most people taking degrees is 22, then for example it's nonsense to suggest 35 years work to 57 could ever sustain 25 years retirement up to 82. The sums simply don't add up. Prudently assuming modest real terms investment growth, workers would have to save say 35% of their gross salary in state, company and private pensions. Throughout their entire careers.