Pensions

[kevo]

I thought SSP was Statutory Sick Pay
What's SERPS then [State Earnings Related Pension Scheme], is that not what you mean by SSP

I agree, to the man in the street, pensions can be a fecking minefield.

I think State Secondary Pensions replaced SERPS.

 

[Driver8]

SSP = State Second Pension or S2P to us I'm the business! It replaced SERPS.

 

[TSB]

I thought SSP was Statutory Sick Pay
What's SERPS then [State Earnings Related Pension Scheme], is that not what you mean by SSP

I agree, to the man in the street, pensions can be a fecking minefield.

I guess it's that too. It's also State Second Pension. Got to love acronyms. Believe S2P is more commonly used, but I HATE HATE HATE replacing Second with 2nd.
SSP was a replacement for SERPS that came in around 10 (?) years ago.

 

[LamieRobertson]

I do have a background in Pensions as it was the first admin job I took after leaving school. But I remember how many people used to write in/call up absolutely dismayed by what they were going to receive from their pension. Most people had no option than to keep working. Since then I have made it my mission to make sure I stay on top of my pensions almost monthly, weekly in some cases and make sure I monitor the investment performance, moving it around when I think I should do. I am still on track to retire on my full salary come age 55 (i'm currently 35) and, whilst there is a long way to go, I really believe active management and getting to grips with your pension is the only way

I took this action by combining all my small pensions into a SIPP and taking income drawdown before they hiked the age limit to 55..best thing i did ..not for everyone..but i find it enjoyable and profitable

 

[kevo]

I took this action by combining all my small pensions into a SIPP and taking income drawdown before they hiked the age limit to 55..best thing i did ..not for everyone..but i find it enjoyable and profitable

What's a SIPP when it's not a SIPP of, say, a pint of Harveys?

 

[TSB]

What's a SIPP when it's not a SIPP of, say, a pint of Harveys?

Self-Invested Personal Pension. Wider range of fund choice and, potentially, lower charges.
They're not bad, but they're no match for Harveys.

 

[Silkster365]

I took this action by combining all my small pensions into a SIPP and taking income drawdown before they hiked the age limit to 55..best thing i did ..not for everyone..but i find it enjoyable and profitable

Good move - I have a SIPP too, but alas I am stuck until age 55 now (or more likely 60 as I am sure they will hike the minimum age for private pensions again at some point over the next 20 year)

If they lowered the age to 50 again I would be the happiest man alive

 

[Dean Deyn]

...and the proportion of private sector employees and the self-employed under, say, 40 who get better pensions than those in the public sector?

The position for those not on final salary schemes is a nightmare and a scandal, and many (most?) of the under 40s will fall into this camp, as you suggest. But that doesn't negate my point that this this not simply a public vs private sector issue. The figure I see quoted everywhere is that 9% of private sector workers are still in final salary schemes, which is circa 2 million people. This compares with a public sector workforce of 6 million, most (but not all) of who will be in final salary schemes. So we can assume that, of the current workforce, one in four of those fortunate enough to be in final salary schemes are in the private sector, and probably in more generous schemes that the public sector ones. Thus my point that it is not simply the case that public sector = final salary schemes, private sector = defined contribution schemes.

 

[Alex Alex Dawson oo! oo!]

I do have a background in Pensions as it was the first admin job I took after leaving school. But I remember how many people used to write in/call up absolutely dismayed by what they were going to receive from their pension. Most people had no option than to keep working. Since then I have made it my mission to make sure I stay on top of my pensions almost monthly, weekly in some cases and make sure I monitor the investment performance, moving it around when I think I should do. I am still on track to retire on my full salary come age 55 (i'm currently 35) and, whilst there is a long way to go, I really believe active management and getting to grips with your pension is the only way

This is the nub of it all, you cannot afford to be passive and have to put some serious effort in, whether you do it yourself or have (ie pay) someone to manage it for you. I could afford to retire earlier then planned (at 55) because I had built that flexibility into my pension planning since I first started working full-time on 1973; my wife did likewise and also retired at 55.

 

[kevo]

It used to be the case that public sector pensions were more generous because the salary rates were poor compared to the private sector, but that is not really the case any more. I'm always staggered by how much some public sector jobs pay. Meanwhile, there has been a massive growth of low-paid, short-contract private sector jobs, particularly in retail and the service industries.

 

[Silkster365]

This is the nub of it all, you cannot afford to be passive and have to put some serious effort in, whether you do it yourself or have (ie pay) someone to manage it for you. I could afford to retire earlier then planned (at 55) because I had built that flexibility into my pension planning since I first started working full-time on 1973; my wife did likewise and also retired at 55.

Well done. Have to admit I get it wrong sometimes, but generally manage to make 7-10% per annum growth which is pretty decent

 

[Alex Alex Dawson oo! oo!]

Well done. Have to admit I get it wrong sometimes, but generally manage to make 7-10% per annum growth which is pretty decent

I started paying an IFA to manage my pension arrangements when I first started up and managing businesses just after the millennium (because I didn't have the time any more). However, we'd meet every quarter to review and certainly talk at least once a month. I still have a six figure sum that hasn't yet been taken as a pension, indeed I may never do so and just leave it in there. Another point to remember is that you have to invest some serious cash, eg £50pm is going to get you very little.

 

[Silkster365]

I started paying an IFA to manage my pension arrangements when I first started up and managing businesses just after the millennium (because I didn't have the time any more). However, we'd meet every quarter to review and certainly talk at least once a month. I still have a six figure sum that hasn't yet been taken as a pension, indeed I may never do so and just leave it in there. Another point to remember is that you have to invest some serious cash, eg £50pm is going to get you very little.

Yes I agree, I try to put away around 20% of my salary each month, but some of my friends and colleagues are something nearer to 6 or 7%. Pensions are a weird thing as it seems to be the one thing that everyone just assumes will be taken care of for them. Some of my friends still dont have a pension at all yet (age 35) and how they expect to live come age 70 when they finally do stop work I dont know!

 

[SIMMO SAYS]

Started my self employed pension in 1974 with the Prudential---I paid as much as I could afford then: £5.00 a month including life insurance. I was earning £20.00 a WEEK as a VERY GOOD cabinet maker at Bevan Funnell Newhaven.
The following year the Pru said I should be paying a LOT more to give me a good pension----I was eighteen years old.
The Pru have advised me for the last forty years I should be paying more despite me increasing my payment as much as I could.
I have four kids/wife and a mortgage still to be paid off - I'm fifty seven.

A few years ago someone sneezed in Japan and wiped off most of my pension in an afternoon.

I have spent the rest of my wages on my Family & & & Florida holidays and do not regret a thing.

Not necessarily in that order tho

 

[Mellor 3 Ward 4]

The position for those not on final salary schemes is a nightmare and a scandal, and many (most?) of the under 40s will fall into this camp, as you suggest. But that doesn't negate my point that this this not simply a public vs private sector issue. The figure I see quoted everywhere is that 9% of private sector workers are still in final salary schemes, which is circa 2 million people. This compares with a public sector workforce of 6 million, most (but not all) of who will be in final salary schemes. So we can assume that, of the current workforce, one in four of those fortunate enough to be in final salary schemes are in the private sector, and probably in more generous schemes that the public sector ones. Thus my point that it is not simply the case that public sector = final salary schemes, private sector = defined contribution schemes.

I think that very much depends.

Show me a better pension that the Firefighters, police, or indeed teachers.

Sure they pay a significant amount into their pensions, a very significant amount of their pension is funded by the tax payer. The same tax payer who can't afford their own pension contributions.

 

[cunning fergus]

I thought SSP was Statutory Sick Pay
What's SERPS then [State Earnings Related Pension Scheme], is that not what you mean by SSP

I agree, to the man in the street, pensions can be a fecking minefield.

Maybe the reason why Pensions and matters of personal finance are so complex is because by making them ever more complex the man in the street is forced to seek out advice from the "learned" classes and then pays hansomely through the nose for it.

Take Inheritance Tax for example, when Alistair Darling was chancellor he changed IHT legislation (in 2007) relating to transferrable nil rate bands; all of sudden the man in the street has to check, change or renew his will, all because a single change in the law has made IHT planning more complex.

So, who actually benefits from the introduction of another layer of IHT complexity?

Now if Alistair Darling never used to be a tax solicitor in Scotland with financial interests still linked to a scottish law firm specialising in wills and trusts then I wouldnt be suspicious?

The thing is (and its not a party political point) its not in the interets of any Govt to simplify matters like this, legislative complexity is now a lever for stimulating the economy.

Change may come if we can ban lawyers from being MPs.

 

[kevo]

Sure they pay a significant amount into their pensions, a very significant amount of their pension is funded by the tax payer. The same tax payer who can't afford their own pension contributions.

This is the point really. I'm not sure why people who can't afford their own pension, and face having to live off maybe a half (or, in some cases, considerably less) of their final salary, should fund others so they can enjoy a full final-salary pension. Three-quarters or something would be enough. Surely the older you get the less you spend?

 

[Silkster365]

This is the point really. I'm not sure why people who can't afford their own pension, and face having to live off maybe a half (or, in some cases, considerably less) of their final salary, should fund others so they can enjoy a full final-salary pension. Three-quarters or something would be enough. Surely the older you get the less you spend?

As far as I am aware the maximum you can get under final salary is still 2/3rds final salary I think?

But I agree with your point nonetheless!

 

[Beach Hut]

Lucky to be on a 2/3rds scheme will shortly have do 34 years. You cannot pay in anymore after 40 years so should be ok to retire in 5 years.

 

[seagullsovergrimsby]

I'm pissed off at the moment because to qualify for a full state pension they equalised it a while back at 30 complete years NI contributions. From 2016 under the new state pension rules I need 35 years of paid up NI contributions to get a 100% pension. Not good if you now only work part time I also have to wait until I am 66 to get it but there is likely to be another review in 2020 where knowing my luck they will bring forward the date when 67 becomes the new qualifying age.