Pension stuff, how's it all looking ? HAve you prepared ?

[Noggin]

I really need to try and get access to the info online for my pension. i've probably missed the chance to pay the bits I've missed and set up paying in until retirement age. But I need to try. Unfortunately they have my DOB incorrect (despite me sending them all the relevant details years ago to correct this) so it's been impossible to get into the system and i've not been in the uk long enough to make an appointment in person to sort it out

Aside from that, I need to find out how long I have to work in France to get a pension here too - I have a suspicion that I won't manage to work long enough, but if I know, then maybe I can.

Sadly, I had a very short sighted view on retirement - mostly cos I never expected to live very long. Always suffered from depression and figured that if an accident didn't get me, I would - then I realised how bad it was on the side of the people left behind and won't go that route. So now I'm left with a genetic leaning towards long life and no plans

But, I'm finally getting into a good place income wise (should have a permanent contract for next winter as so that changes everything here for planning and ability to get loans/mortgages etc). So, hopefully things will work out ok. Might need a lot of luck though!!

[weeksy]

This was a fairly decent thread.... if it stops being that, it'll be deleted fully.

Lets keep it on topic hey

(i've been out for a MTB ride and then cleaned up)

[Cousin Jack]

I have been lucky (gold plated final salary scheme), but the biggest problem is bloody governments, always tinkering with rules on a 5 year timescale, when proper pension planning needs stability on a 30+ year timescale.

Advice? Don't ever trust the government, and don't put all your eggs in one basket.

[weeksy]

I still need to look for an IFA when we get closer to 2026 so i can fully decide on what i do with my pot and what i don't do with it in terms of the 25% allowance. As someone said to me, "you only get one chance to take money at no tax" (it's not strictly true as we know, but the point kinda is)

I'm not going to decide until i see where life is taking us by then, we've discussed moving house and it'd likely be around that sort of time too, so if we could downsize in price (likely) and get the mortgage paid off with some of the money, a nice new van for me and possibly a couple of weeks away, then i'd take that.
All of that though depends on what the boy is doing in terms of racing/schooling etc.

My pension itself is currently with Scottish Widows and in the last 6 months it's been completely insane in terms of increases, i'm more than happy with how it's doing. So that'll be left where it is at the moment, it's more about whether i pull out the 25% (or a %age of it) and what i do or don't spend it on.

[Mr. Dazzle]

You have to spend the 25% on anything. You can just save it somewhere else

EDIT: don't have to

[weeksy]

You have to spend the 25% on anything. You can just save it somewhere else

Of course yes. But I was planning on enjoying it too

[Count Steer]

You have to spend the 25% on anything. You can just save it somewhere else

I think there's a 'don't' missing.

The other thing is, you don't have to pull the 25% straight away. You could leave it and hope it's 25% of a bigger number. (Assuming they don't stop allowing it, which I think is low risk. More likely they'll push the age you can take it up again in a few years time).

[Sunny]

Good timing for me as I'm at the start of giving this some serious thought now.

I'm 44, and currently working full time on a decent salary, but would really like to not be working forever - at least, not doing what I do currently.

I've been fixated on paying off the mortgage, and am about a year away from achieving that (thanks also in part to a donation from the bank of mum and dad, to be completely transparent). So now it's time to think about what's next.

Aside from the mortgage thing, I'm a bit spend-happy. So I need to reign that in for starters

A couple of unforeseen events over the last couple of years wiped out my savings, so I've restarted on that over the last couple of months. I'm one of those people who find it way easier to save when there's some money already there, so I've shoved £2K in a Zopa instant access cash ISA at 5.08% to get me started.

As a higher tax payer though, once I've got a bit of a safety net built back up, it feels sensible to start stashing chunks tax-free into my work pension, so I'll be looking at that as soon as I start at my new place (in May). I'm thinking maybe £30K a year might be sensible.

Pension-wise I have a fair few, but my current pots stand at around £160K.
Plus I have a couple of years of a railway final salary scheme that should help.

I also need to think about t'other half, who has minimal pension stuff in existence, and no current pension plan. I've been planning our future based on mine, but if I snuff it before him, he's going to need something to keep him going too.

No investments currently either.

[Cousin Jack]

Does seem a bit circularly perverse to pay tax on interest the government paid you

That's Governments for you. People get paid benefits and have to pay tax on them.

IMO it is plain bloody stupid, and inefficient as hell, but no-one is going to give us a sensible taxation system, it is always add more rules on top of the old.

[Dodgy69]

I've nibbled away at some of my 25% on a new bathroom, internal doors, etc, basically, sensible stuff that she's happy about. Also, there's no more space in the garage. ☹

[Dodgy69]

From 6th April 2028, you'll need to be 57 to access your pension. This could piss off quite a few I reckon. I wouldn't bank on getting a state pension in years to come, more will die before they reach state pension age, which will probably be 70 odd years old.

I could be wrong though, I was once.


Ps...what was wrong with the other pension thread.

[Sunny]

I'm at the start of giving this some serious thought now.

I'm 44, and currently working full time on a decent salary, but would really like to not be working forever - at least, not doing what I do currently.

I've been fixated on paying off the mortgage, and am about a year away from achieving that (thanks also in part to a donation from the bank of mum and dad, to be completely transparent). So now it's time to think about what's next.

Aside from the mortgage thing, I'm a bit spend-happy. So I need to reign that in for starters

A couple of unforeseen events over the last couple of years wiped out my savings, so I've restarted on that over the last couple of months. I'm one of those people who find it way easier to save when there's some money already there, so I've shoved £2K in a Zopa instant access cash ISA at 5.08% to get me started.

As a higher tax payer though, once I've got a bit of a safety net built back up, it feels sensible to start stashing chunks tax-free into my work pension, so I'll be looking at that as soon as I start at my new place (in May). I'm thinking maybe £30K a year might be sensible.

Pension-wise I have a fair few, but my current pots stand at around £160K.
Plus I have a couple of years of a railway final salary scheme that should help.

I also need to think about t'other half, who has minimal pension stuff in existence, and no current pension plan. I've been planning our future based on mine, but if I snuff it before him, he's going to need something to keep him going too.

Oh, and I have no shares/investments, though I should have an equity option in my new place of work towards the end of the year...

[Count Steer]

Apparently there are details to iron out but it looks like you can choose the fund, as long as it’s UK based. So I don’t know what’s not to like, as you say you get to bung another five grand into a tax free wrapper.

I was hoping that it’s been misrepresented and it’s actually just a blanket increase of the ISA limit, but atm it appears not.

The consultation period runs until June 6th, so it’s anyone’s guess. It’ll probably end up like the old PEP because that’s the easiest route for them to take.

Yup. I just tried to read the consultation document. I guess we have to wait and see what the consultation comes up with. I'll even be interested to see how they define 'UK company' tbh.
I'll have another read of the doc later...on a bigger screen.

I had a dig into the doc. Yeah, it'll probably end up like the PEP. They clearly want to include stuff like companies on AIMs but are steering clear of where the majority of a company trade is, which makes sense.

Watch this space I guess.

[JackyJoll]

They should have raised the ISA limit across the board and had done with it..

Failure to raise ISA limits during or after a period of inflation looks like another example of a tax rise through fiscal drag.

[weeksy]

They should have raised the ISA limit across the board and had done with it..

Failure to raise ISA limits during or after a period of inflation looks like another example of a tax rise through fiscal drag.

Not to mention the income tax threshold when wages are skyrocketing.

That's a decent point. When were they last changed for Tax rates? I recall when my salary went just over the 40% threshold and it freaked me out

[Count Steer]

I had a dig into the doc. Yeah, it'll probably end up like the PEP. They clearly want to include stuff like companies on AIMs but are steering clear of where the majority of a company trade is, which makes sense.

Watch this space I guess.

Having looked at it a bit more it looks like a pretty poor token effort, the limit is peanuts and the gains will be the price of a cup of coffee a day at Pret.
I doubt I'll be bothering.

They should have raised the ISA limit across the board and had done with it.
Or at least something inventive, where the limit is scaled based on age and any tax advantage is scaled depending on how long you leave it there.

I think the potential benefits we look for in these things is sort of secondary to the intention. When PEPS were introduced the motivation was to expand share ownership...the 'share owning democracy' thing and that fitted in with the sale of shares in British Gas, Rolls Royce etc etc. The tax status was the carrot.

TESSAs/ISAs were more about encouraging people to save generally. I guess they saw the pension problems coming down the track.

The driver behind the British ISA appears to be a fear that the UK stock market is losing ground as it gets easier to invest elsewhere and to address the lack of investment in productivity in the UK. In which case it's a sticking plaster/token gesture as the problem is structural.

As an aside it always struck me as a bit that you work/earn, pay your taxes and, from what you save, you stash it for a rainy day....and pay more tax on the benefits. At least with pensions you get relief on what you put in even if you pay tax on what you get out.

[Count Steer]

Failure to raise ISA limits during or after a period of inflation looks like another example of a tax rise through fiscal drag.

Not to mention the income tax threshold when wages are skyrocketing.

That's a decent point. When were they last changed for Tax rates? I recall when my salary went just over the 40% threshold and it freaked me out

It's why they say the NI decrease is swamped by the extra tax take from pushing people through the fixed thresholds. I read something along the lines of people on minimum wage would pay something like 47% less tax if the thresholds hadn't been frozen. (I'll have a rummage, but the frozen thresholds was an 'austerity' measure and it's become a real disincentive. It's one if the main reasons our total taxation is so high. Highest since 1940-something.

Address that and they might actually get the economy moving, people into work etc etc etc.

[Mr. Dazzle]

As an aside it always struck me as a bit that you work/earn, pay your taxes and, from what you save, you stash it for a rainy day....and pay more tax on the benefits. At least with pensions you get relief on what you put in even if you pay tax on what you get out.

That's the point of Premium Bonds and latterly ISAs though right? Make it so "ordinary people" can save a chunk without being 'double taxed' but put a limit on how much you can save so it's not just a total tax dodge for millionaires. The general idea makes a lot of sense.

When they started 20k was a much bigger chunk than it is now. 20k seems the arbitrary figure for what constitutes a pretty big annual sum for said "ordinary person" to save, for the most part that's true.

This is why I save in both a SIPP and Stocks/Shares ISAs. I put more in the SIPP to be fair 'cause I get tax relief now, but now I've got a decent chunk of my salary going into a SIPP I'm putting future pay rises into an ISA. I pay tax on the ISA money now, but I won't (hopefully ) have to pay tax on that money in 20 years time - unlike the SIPP money. Main reason I do it though is to hedge my bets, 'cause almost certainly pension and ISA rules will change (more than once) in the next ~25 years.

[Mr. Dazzle]

Or maybe they could make your ISA allowance - or some portion of it - cumulative, rather than reset every year?

[Count Steer]

As an aside it always struck me as a bit that you work/earn, pay your taxes and, from what you save, you stash it for a rainy day....and pay more tax on the benefits. At least with pensions you get relief on what you put in even if you pay tax on what you get out.

That's the point of Premium Bonds and latterly ISAs though right? Make it so "ordinary people" can save a chunk without being 'double taxed' but put a limit on how much you can save so it's not just a total tax dodge for millionaires. The general idea makes a lot of sense.

Oh, absolutely it shouldn't be a tax dodge for stashing £millions. I'm thinking more of the situation like:

State pension is paid sans tax and deducted from your tax allowance so after deducting your £11760 pension from your Personal Allowance you get a tax code of...81 ie you can have another £810 income before the tax man cometh. Fair enough if you're drawing another pension that you got tax relief on the money going in, but otherwise people dependant on share dividends/savings can get £1000 tax free and/or are dependent on wheezes like ISAs to get to the equivalent of a living wage before getting hit for tax. It just seems all wrong to me.