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General Chat Thread, Retirement Age being scrapped in General; Originally Posted by tmcd35 If I was to find myself in an asset-rich cash-poor situation when I come to retire ...
  1. #46

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    Quote Originally Posted by tmcd35 View Post
    If I was to find myself in an asset-rich cash-poor situation when I come to retire then I'd feel morally bound to free up some of those assets before going cap in hand to the state.
    My folks are retired now, and have a fair sized house (when the grand kids were smaller, we did squeeze 14 in, I slept under the dinning table), both drawing occupational and state pensions. If they were to down size, they couldn't have the family to stay. Is really what you'd do in their place? I suspect that your (and my) perspective will evolve as we near the age when we (might) draw a pension if there is anything left!

  2. #47

    tmcd35's Avatar
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    Quote Originally Posted by broc View Post
    There already is, it is part of the taxation system. If your income exceeds your personal allowance you pay tax...... even as a pensioner.....
    I'm having a "Tim nice but dim" moment - I'm not sure I'm following you here.

    I can't see the relationship between the personal income tax allowance, the basic state pension which everyone gets after state pension age, and the winter fuel allowance.

    What I'm saying is that the basic state pension should only be paid to those that really need it, and it should be for an amount that covers the winter fuel allowance with that being a seperate applied for benefit.

  3. #48

    tmcd35's Avatar
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    Quote Originally Posted by Andrew_C View Post
    My folks are retired now, and have a fair sized house (when the grand kids were smaller, we did squeeze 14 in, I slept under the dinning table), both drawing occupational and state pensions. If they were to down size, they couldn't have the family to stay. Is really what you'd do in their place? I suspect that your (and my) perspective will evolve as we near the age when we (might) draw a pension if there is anything left!
    I'm sure you are right, by the time I'm due to reture my opinions my well shift. But right now I still don't see it has fair placing an extra burden on society because I made the wrong financial choices. If I put all my money into buying my home and none into a pension pot that could make living their affordable then why should society has a whole bail me out? I have money tied up in the home I bought I should releae some of it to pay my way.

    If life throws some duff cards my way and I couldn't afford to build a pension pot and I loose my home - well that's what the safety net of the welfare state is for, to stop people - especially pensioners - from having to live and beg on the streets.

    But, like I say, that is just my POV

  4. #49
    torledo's Avatar
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    Quote Originally Posted by broc View Post
    Means testing is fine in theory, but for benefits such as winter fuel allowance it would probably cost more to administer than the savings that might be made.
    quite possibly. but i don't look at means testing of benefits purely from a cost-vs-savings point of view. it's a question of fairness, that is ultimately what benefits and taxes are about. And means testing, when done properly.

    Also, don't forget that many 'baby-boomers' may be 'asset-rich' but remain 'cash-poor', having spent years putting all their money into house purchase & raising a family & making sacrifices along the way. My children where teenagers before we could afford to take them on a foreign holiday.
    that's why i acknowledged the intergenerational wealth transfer. Or housing equity recycling in the case of boomers helping their children onto the housing ladder.

    Selling the family home may release asset value, but you still need somewhere to live.... how would it be if baby-boomers sold their big expensive family homes & bought up starter homes, driving up the prices of these?
    that sounds like a plan. There's a real dearth of quality 3/4-bed family homes in my area, a few more boomers 'downsizing' to put such properties on the market would be very good for the local market...what's the alternative ? Next to zero family homes within existing communities are being newly built, and i bet that situation is replicated in many areas.

    they'd be ideal houses for young families looking for an extra bedroom and decent sized gardens for young kids to play in. I'd rather that outcome than having one retirement age for asset rich boomers today, a higher age for when later generations retire and in the meantime more fuel allowances, state funded care at home, mortgage interest payments or whatever public funded bright ideas are dreampt up next for the current near-retirees. But you can bet won't be anywhere near as generous for future retirees.

    I don't want to pay for all this via a loss in my standard of living today via high house prices, grey ceiling at work etc. and in the future via higher taxes and more years in work. why on earth shouldn't these properties fund such retirement expenses [beyond a basic state provided level of income/care], while they still have these inflated values ?

  5. #50

    broc's Avatar
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    Quote Originally Posted by tmcd35 View Post
    I'm having a "Tim nice but dim" moment - I'm not sure I'm following you here.

    I can't see the relationship between the personal income tax allowance, the basic state pension which everyone gets after state pension age, and the winter fuel allowance.

    What I'm saying is that the basic state pension should only be paid to those that really need it, and it should be for an amount that covers the winter fuel allowance with that being a seperate applied for benefit.
    People pay into the 'system' based upon their earnings to fund their retirement. If they are fortunate enough to work all their 'working' life they pay into the system all their life.... the state funds these payments for unemployed people when they claim unemployment benefits.

    When people retire, they receive universal benefits which are taxable along with any other income they have from savings, pension income from employment etc. Many pensioners don't claim all they are entitled to, sometimes because they are ignorant of their entitlement, sometimes it's pride... but at least universal benefits payable to all ensures that the money reaches people that need it most & the Govt can claw back some of it that is paid to wealthy people who don't need it via taxation

    Things like housing benefit, council tax relief etc are means tested already.

  6. #51
    torledo's Avatar
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    Quote Originally Posted by tmcd35 View Post
    I'm sure you are right, by the time I'm due to reture my opinions my well shift. But right now I still don't see it has fair placing an extra burden on society because I made the wrong financial choices. If I put all my money into buying my home and none into a pension pot that could make living their affordable then why should society has a whole bail me out? I have money tied up in the home I bought I should releae some of it to pay my way.
    exactly. my point is that the govt. should prioritize based on the wider need, rather than focusing benefits and entitlements on certain demographics. There just isn't the housing supply to justify policies which state that the public purse should ensure that no retiree need sell their home to fund retirement expenses.

    i take a similar view toward inheritance tax, i believe it should apply to the 'family home' so that there isn't this perpetuation of the protection of inherited wealth. if you need to sell a property to pay an IHT bill so be it. If you need to sell a property to fund living for a lot longer then so be it. I don't see why the state should go that extra mile to protect such assets. ofcourse maybe i will feel very differently should i ever be put in such a position, but i certainly wouldn't expect any govt. to make it easy for me via it's policies so i can avoid selling up.

  7. #52

    tmcd35's Avatar
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    Quote Originally Posted by broc View Post
    When people retire, they receive universal benefits which are taxable along with any other income they have from savings, pension income from employment etc. Many pensioners don't claim all they are entitled to, sometimes because they are ignorant of their entitlement, sometimes it's pride... but at least universal benefits payable to all ensures that the money reaches people that need it most & the Govt can claw back some of it that is paid to wealthy people who don't need it via taxation
    I love this example, it pretty much makes my point for me.

    At one end of the scale we have the government paying multimillion pensions the basic state pension. "Hey Mr Multimillionaire, here's some extra money you really don't need. But hey I don't mind giving to you because I'm gonna take 40% right back again and that'll make fair. Don't worry you keep the other 60%, I know you don't need it - just take it!"

    And on the other end of the scale we have poor little Doris who gets the basic state pension and that is her whole income. She can't afford to live but hey there are other benefits available to her if she'd only apply for them. Shame she understands the benefits system as well as I do and finds it very difficult to work out what she can apply for and how she does it.

    And we call this a fair system?

  8. #53
    torledo's Avatar
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    Quote Originally Posted by tmcd35 View Post

    And on the other end of the scale we have poor little Doris who gets the basic state pension and that is her whole income. She can't afford to live but hey there are other benefits available to her if she'd only apply for them. Shame she understands the benefits system as well as I do and finds it very difficult to work out what she can apply for and how she does it.
    it's a shame that so many people don't claim what they are entitled to, but i can't see the current boomers being so backward in coming forward when it comes to claiming what's theirs. Not that they'll have to worry too much about the fuel allowance, pension credit and council tax benefit.... such forward planners don't leave stuff like retirement to chance. or the state for that matter...LOL

  9. #54

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    Quote Originally Posted by tmcd35 View Post
    I love this example, it pretty much makes my point for me.

    At one end of the scale we have the government paying multimillion pensions the basic state pension. "Hey Mr Multimillionaire, here's some extra money you really don't need. But hey I don't mind giving to you because I'm gonna take 40% right back again and that'll make fair. Don't worry you keep the other 60%, I know you don't need it - just take it!"

    And on the other end of the scale we have poor little Doris who gets the basic state pension and that is her whole income. She can't afford to live but hey there are other benefits available to her if she'd only apply for them. Shame she understands the benefits system as well as I do and finds it very difficult to work out what she can apply for and how she does it.

    And we call this a fair system?
    I don't think it is a fair system either; I was stating the facts as I understand it, based upon the experience of my elderly father, who worked all his life, paid into his company pension scheme and receives £4 per week company pension on top of his state pension.

    He's too proud to claim, but things like winter fuel & free TV licence make a big difference to him. It took a lot of persuading to get him to claim for housing benefit & council tax relief, even though it is his right.

    I would like to see more fairness in our benefits system too, but to pick up on torledos comments about current baby boomers not being backward in coming forward I have no intention of being a martyr by refusing to claim what I am entitled to when I retire.

    I have seen my taxes wasted by successive governments on all manner of hair-brained schemes, I have seen plenty of evidence where I work of Government initiatives that have bred a culture of state benefit dependency where once there were proud working communities.

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    Right, I'm a bit drunk but will try to reply, real ale pub with a blues band, my kind of night
    National Insurance was initially set up as an insurance policy to provide free health care and a state pension to all, no matter what their financial situation.
    The problem is, progressive governments have used National Insure as a tax, rather than as an insurance for the above provisions. Therefore the money isn't there, plus the tax raid on private pensions by the last two governments have made things dramatically worse.
    So, how do we get round this? Well, in my opinion, short term whilst we are in this financial crisis, not much. Long term, we've got to start using National Insurance as it was intended and put it aside to cover state pension cost and pay a decent pension rather than all these stupid top ups. We've also got to stop doing tax raids on private pensions, so that people see the benefit from their private pensions.

    Right, I'm going to pass out, it's taken me far too long to type this and correct the typos, hic....

  11. 2 Thanks to teejay:

    localzuk (30th July 2010), SteveT (30th July 2010)

  12. #56
    leco's Avatar
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    [slightly tongue in cheek] If it takes real ale to make people talk sense - maybe Dick and Nave should be taken to a real ale pub every night.

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    It looks like within the private sector companies will still be able to work their own compulsory retirement policies - Scrapped retirement age will live on in private sector, says expert | Pinsent Masons LLP

    It's not going to be an easy transition no matter what happens, but changes never really are.

  14. #58
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    An employer can still justify a mandatory retirement age and use justifications like wanting to balance the workforce and provide opportunities for younger employees
    sounds perfectly reasonable to me.

  15. #59
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    we are all assuming that state pension will still be around when we reach that Golden Age, on a personal oppinion i would rather invest my money into a property that i know would still be there when i reach that age. this wouyld be my safty net. If (which i am) paying national insurance up until the golden age why shouldnt i receive a state pension and why should i get taxed on this!!! i have been taxed all my life and unfortunatly when im gone i will still have to pay tax on the inheritance that i leave my children... i understand that we have to pay national insurance towards a pension pot but to be taxed on the pension pot that i am building seems stupid...

    this is why i have invested into property because i just cant really rely on a systems where people who are multimillionairs still receive a state pension and get taxed and people who are at the lower end of the scale get there state pension but no additional help(and get Taxed). we have to plan accordingly and create our own safty net... and not rely on a pot that might not be hear in the future...

  16. #60

    NikChillin's Avatar
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    By taking away the compusory retirement age people who can't afford to retire can continue to work rather than retiring in poverty. Nobody wants to work until they drop but bills need paying.

  17. Thanks to NikChillin from:

    Martin (30th July 2010)



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