Good article

https://www.bloomberg.com/opinion/articles/2023-01-19/the-uk-beats-france-for-one-of-the-best-pensions-in-the-world?utm_source=website&utm_medium=share&utm_campaign=mobile_web_share

Markets up shit creek, looking like another bleak year for returns…. Safer chucking money in the bank now interest rates are climbing. 

Edited March 17, 20233 yr by Mounts Kipper

8 minutes ago, globaldiver said:

I think it’s more that the introduction of the cap could affect 25% in the future. 

Looking at your question, it means that if you put in enough and/or have decent investment returns to bust the Lifetime Allowance, then you wouldn’t be subject to an additional charge on busting (and/or age 75)

This could save a lot of money. One of the key benefits, in my view, is the ability to continue to invest “correctly” to achieve your desired income throughout life, rather than keeping an eye on the Lifetime Allowance and tax you might pay.

Hope that makes sense!

Ok thanks, I hope to be able to put away that kind of money once the mortgage is paid off and the kids bugger off. Mot sure it will happen mind.

5 minutes ago, MalcolmW said:

Falconer was due to be selected as prospective MP for Dudley North, but the selection panel refused to endorse him because his children were being privately educated and he refused to consider changing even if state schools improved under Labour. So Blair ennobled him as soon as he got power, and appointed him as Solicitor-General straght away.

Some pigs are more equal.

3 minutes ago, Winchester White said:

Ok thanks, I hope to be able to put away that kind of money once the mortgage is paid off and the kids bugger off. Mot sure it will happen mind.

Just ask if you need anything else.

2 minutes ago, Mounts Kipper said:

Markets up shit creek, looking like another bleak year for returns…. Safer chucking money in the bank now interest rates are climbing. 

I am happy to chuck this shitshow of a government under the bus for most things but the last 3 years have been horrendous for most countries.

Recent self inflicted nonsense is still not helping but austerity, Russia & Covid can fuck off. 

I am just wondering now that the world had finally realised giving China all their IPR is a bad thing that we just fall into yet another issue?

9 hours ago, Tonge moor green jacket said:

They were a while back but not now?

Why is that then?

Given it's been an issue increasingly in the news and both parties agree(d).

 

9 hours ago, globaldiver said:

They most certainly are leaving because of the pension situation

https://www.bma.org.uk/news-and-opinion/government-raises-annual-allowance-for-pensions

They always were but most are now quitting because quality of life as a GP is on its knees. This is from a limited pool if three GPs aged 50-60 who five years ago were looking at ways to circumnavigate the pension rules who now couldn't give a flying fuck and are looking for the best way out as soon as possible without screwing up the practices they run. It is not the job they signed up for I'm afraid.

Hes at least part right

Whether you agree with them or not, many gps dont want to be gps for all sorts of reasons

I think the pension change is still a good idea as it might retain a fair few...just disagree with it not being targeted to sectors where we have staff shortages

Just feels like a giveaway to the rich

Again

12 hours ago, globaldiver said:

Some pigs are more equal.

Aye

a glance at Boris Johnson’s outgoing honours list is concrete proof

The thing about the Pension cap is that is sounds like £1m is a massive amount which it is. But if you are retiring at 60. It goes quickly. To be clear I am not saying there should be too many benefit concerts to raise money for these poor little teddy bears....but....

Someone on PAYE of £100k per annum gets £12.7k tax free and £37k @ 20% , they then pay 40% on the rest , that is about £37k per annum in tax . (It will be less as Pension contributions are tax free but still a decent amount of income) . What increasing the cap does is encourage these people to stay in work a few more years.

Remember the Pension is also mainly taxable. I have posted previously that £1m ain't that much. Once you take a chunk to pay the mortgage off and start drawing down annually.

37 minutes ago, Ani said:

The thing about the Pension cap is that is sounds like £1m is a massive amount which it is. But if you are retiring at 60. It goes quickly. To be clear I am not saying there should be too many benefit concerts to raise money for these poor little teddy bears....but....

Someone on PAYE of £100k per annum gets £12.7k tax free and £37k @ 20% , they then pay 40% on the rest , that is about £37k per annum in tax . (It will be less as Pension contributions are tax free but still a decent amount of income) . What increasing the cap does is encourage these people to stay in work a few more years.

Remember the Pension is also mainly taxable. I have posted previously that £1m ain't that much. Once you take a chunk to pay the mortgage off and start drawing down annually.

Well put.

If possible, and especially for basic rate taxpayers, saving into an ISA complements a pension well, as any income (or any withdrawal) is tax free, which effectively increases the personal allowance.

1 hour ago, Ani said:

The thing about the Pension cap is that is sounds like £1m is a massive amount which it is. But if you are retiring at 60. It goes quickly. To be clear I am not saying there should be too many benefit concerts to raise money for these poor little teddy bears....but....

Someone on PAYE of £100k per annum gets £12.7k tax free and £37k @ 20% , they then pay 40% on the rest , that is about £37k per annum in tax . (It will be less as Pension contributions are tax free but still a decent amount of income) . What increasing the cap does is encourage these people to stay in work a few more years.

Remember the Pension is also mainly taxable. I have posted previously that £1m ain't that much. Once you take a chunk to pay the mortgage off and start drawing down annually.

Aye, by staying in work, they're still paying that high rate. Once out, that goes. Not so bad if they're being replaced, but if there is a shortage of replacements, then they need to hang around until new ones are trained. Valuable experience too which shouldn't be underestimated. 

Another thing to factor in is inflation. Who knows what will happen with inflation going forward, but if you base it on the BoE target of 2% p/a, £1m won’t go nearly as far at the point of retirement, let alone 20 years into retirement.

Maths isn’t my strong point, but fag packet calculations suggests that for those who are 40 now and looking to retire at 65, to have the equivalent of a £1m pot now, you would need to have saved c£1.65 million when you retire. Or, to put it another way, if you have £1m in your pot in 25 years, it would be like retiring now with a pot of £600k.

9 minutes ago, Jol_BWFC said:

Another thing to factor in is inflation. Who knows what will happen with inflation going forward, but if you base it on the BoE target of 2% p/a, £1m won’t go nearly as far at the point of retirement, let alone 20 years into retirement.

Maths isn’t my strong point, but fag packet calculations suggests that for those who are 40 now and looking to retire at 65, to have the equivalent of a £1m pot now, you would need to have saved c£1.65 million when you retire. Or, to put it another way, if you have £1m in your pot in 25 years, it would be like retiring now with a pot of £600k.

Did you compound that 2%? 😁

Could be even more. No way am I bothering to do any maths though!

Some 'expert' on the radio talking on the budget says for the likes of me and other normal-ish folk, the budget saw a real terms 4% hike in tax due to freezing thresholds

Im wondering if that is an incentive for me to work harder or to say fuck it, im retiring

3 minutes ago, Casino said:

Some 'expert' on the radio talking on the budget says for the likes of me and other normal-ish folk, the budget saw a real terms 4% hike in tax due to freezing thresholds

Im wondering if that is an incentive for me to work harder or to say fuck it, im retiring

This budget didn’t freeze thresholds, that was done last year!

Yes, retire.

8 minutes ago, globaldiver said:

This budget didn’t freeze thresholds, that was done last year!

Yes, retire.

Sorry, yes

Eithef way, its a fair question, i think

Why dont they do stuff to encourage me to continue working

I dunno. Maybe taxing me more does that

 

2 minutes ago, Casino said:

Sorry, yes

Eithef way, its a fair question, i think

Why dont they do stuff to encourage me to continue working

I dunno. Maybe taxing me more does that

 

They don’t know your personal pension and financial position!

42 minutes ago, globaldiver said:

This budget didn’t freeze thresholds, that was done last year!

Yes, retire.

But the budget could easily have unfrozen them (would that be melting??) 

with inflation and pay rises so high the Govt will be getting a good boost of income. 

9 minutes ago, Ani said:

But the budget could easily have unfrozen them (would that be melting??) 

with inflation and pay rises so high the Govt will be getting a good boost of income. 

The government doesn’t have any income!

Or money!

It’s from tax or borrowing

😇

1 minute ago, globaldiver said:

The government doesn’t have any income!

Or money!

It’s from tax or borrowing

😇

Surely tax is income ? I have a letter downstairs from HMRC asking me to send them some 😂

 

Just now, Ani said:

Surely tax is income ? I have a letter downstairs from HMRC asking me to send them some 😂

 

🤣😂🤣😂

2 hours ago, Tonge moor green jacket said:

Did you compound that 2%? 😁

Could be even more. No way am I bothering to do any maths though!

Yes, that was compounded… 👍🏻

2 hours ago, Casino said:

Some 'expert' on the radio talking on the budget says for the likes of me and other normal-ish folk, the budget saw a real terms 4% hike in tax due to freezing thresholds

Im wondering if that is an incentive for me to work harder or to say fuck it, im retiring

I think I saw that they reduced the top band income tax threshold to £125k? So half the posters on here will be even worse off.

4 hours ago, Jol_BWFC said:

Another thing to factor in is inflation. Who knows what will happen with inflation going forward, but if you base it on the BoE target of 2% p/a, £1m won’t go nearly as far at the point of retirement, let alone 20 years into retirement.

Maths isn’t my strong point, but fag packet calculations suggests that for those who are 40 now and looking to retire at 65, to have the equivalent of a £1m pot now, you would need to have saved c£1.65 million when you retire. Or, to put it another way, if you have £1m in your pot in 25 years, it would be like retiring now with a pot of £600k.

And that is crazy, especially when the average pension pot size in the UK is a small fraction of those numbers. One article suggested for 64 year olds it is only 107k, 30k for 35 year olds. 

1m is a big pot though, that is 33.3k per year, for 30 years, assuming no investment growth. Including state pension a comfortable retirement pot. But not many will get even close to that 

Edited March 18, 20233 yr by CambridgeBWFC

5 hours ago, Casino said:

Some 'expert' on the radio talking on the budget says for the likes of me and other normal-ish folk, the budget saw a real terms 4% hike in tax due to freezing thresholds

Im wondering if that is an incentive for me to work harder or to say fuck it, im retiring

Fascinating these figures. How does anyone know what each company is doing in terms of wage rises?

Without that data, how do they assess how many folk will tip over into the next bracket?

Anyway, I'm pretty sure there'll be threshold raising this time next year!