Pensioners
- Thread starter Duffman
- Start date
Duffman
Well-known member
So you do want a race to the bottom then? Why should the benchmark be ‘the minimum wage’? We invested heavily into our pensions to avoid poverty in retirement and to still be able to live a full life with a few luxuries like holidays and nice car. I don’t want the minimum wage to be the benchmark for entitlement much as I didn’t want it be my earning ceiling in work. I want the state pension my 50 odd years of working entitled me to to supplement my own private pension. This should not be dampened down because we chose to put a big part of our wages into our pension when working and to take the hit on not doing nice things so we could invest that money. You are punishing prudence.
As for entitlement and contributions, how can you not equate contributions to your entitlement when the level of state pension you qualify for is based on contribution years. Also why does Martin Lewis tell folk to pay a few thousand quid over to the government to improve your national insurance record if it doesn’t then impact your level of state pension? Smoke and mirrors to suggest your contributions were not hypothecated into your own state pension pot - we know that.
As someone with a big sum of money in my property maybe a figure over a certain amount should be taxed when it's sold and the equity taken out of it.
I realise it's not popular with those that expect the tax free nest egg but really..... how much do you need...... and there are those more needy.
Inhertance tax applies to other windfalls so why not the sole property?
I realise it's not popular with those that expect the tax free nest egg but really..... how much do you need...... and there are those more needy.
Inhertance tax applies to other windfalls so why not the sole property?
I used he example of minimum wage because it is currently double the state pension. I'm not saying that's where I'd set anything. As a couple that would put you where the PLSA would class as a moderate retirement. It was just an example.
Home - PLSA - Retirement Living Standards
Home - The Retirement Living Standards have been developed to help us to picture what kind of lifestyle we could have in retirement.
The state pension is not contributory in the sense that you contribute to a pot of money and the more you put in the more you get like a private pension. You have to contribute to qualify for it but it is the same whether you earn £1 above the minimum or £1m.
This sounds very much like the stop buying avocado and toast and an iphone and you can afford a house meme. The housing situation is so different to when you were younger (assuming you are older based on your comment). In the 80s anyone could buy a house with a single salary on an average wage. Earnings to house price ratios were 4.1x in the 80s and they are now 8.8x. Average house prices have risen over 300% while average.wages have risen by less than 100%. On top of that it is harder to save for a deposit because there is no social housing so everyone is paying private rents.
The average house price is £282k and to afford that on average wages they'd need a 10% deposit, the equivalent of over 8,000 takeaway coffees. Even at 1 coffee a day that's 22 years of stopping ordering takeaway coffees needed to afford a house deposit. Young people drink coffee but people used to go to the pub several times a week and that doesn't really happen anymore. Let's not pretend the older generations didn't spend a penny.
I used he example of minimum wage because it is currently double the state pension. I'm not saying that's where I'd set anything. As a couple that would put you where the PLSA would class as a moderate retirement. It was just an example.
Home - PLSA - Retirement Living Standards
Home - The Retirement Living Standards have been developed to help us to picture what kind of lifestyle we could have in retirement.www.retirementlivingstandards.org.uk
The state pension is not contributory in the sense that you contribute to a pot of money and the more you put in the more you get like a private pension. You have to contribute to qualify for it but it is the same whether you earn £1 above the minimum or £1m.
This sounds very much like the stop buying avocado and toast and an iphone and you can afford a house meme. The housing situation is so different to when you were younger (assuming you are older based on your comment). In the 80s anyone could buy a house with a single salary on an average wage. Earnings to house price ratios were 4.1x in the 80s and they are now 8.8x. Average house prices have risen over 300% while average.wages have risen by less than 100%. On top of that it is harder to save for a deposit because there is no social housing so everyone is paying private rents.
The average house price is £282k and to afford that on average wages they'd need a 10% deposit, the equivalent of over 8,000 takeaway coffees. Even at 1 coffee a day that's 22 years of stopping ordering takeaway coffees needed to afford a house deposit. Young people drink coffee but people used to go to the pub several times a week and that doesn't really happen anymore. Let's not pretend the older generations didn't spend a penny.
One thing I would say is you don’t try and get on the ladder at the average price.
Depends where you live. London prices are way above average for way below average houses. Things like Help to Buy and no stamp duty mean people can buy a bigger house as a first time buyer than they can later in life. Also, the cost of moving is very expensive so it's not necessarily economical in the short term to buy a smaller house. House prices rising faster than inflation means buying a starter home means spending a lot up front and larger houses getting more expensive the longer you wait.
The housing market is geared towards buying one house and living in it indefinitely.
RavsFan
Well-known member
Firstly, to suggest there is no social housing is ridiculous, there is, not enough granted, it is just that the demand is far higher now thanks to the stupidity of the right to buy and the government restrictions on councils to re-invest and the lack of speculative building thrown in the mix. Priority for social housing is often given to homeless people from limited access groups, which can be readily manipulated by some of these qualifying groups.I used he example of minimum wage because it is currently double the state pension. I'm not saying that's where I'd set anything. As a couple that would put you where the PLSA would class as a moderate retirement. It was just an example.
Home - PLSA - Retirement Living Standards
Home - The Retirement Living Standards have been developed to help us to picture what kind of lifestyle we could have in retirement.
The state pension is not contributory in the sense that you contribute to a pot of money and the more you put in the more you get like a private pension. You have to contribute to qualify for it but it is the same whether you earn £1 above the minimum or £1m.
This sounds very much like the stop buying avocado and toast and an iphone and you can afford a house meme. The housing situation is so different to when you were younger (assuming you are older based on your comment). In the 80s anyone could buy a house with a single salary on an average wage. Earnings to house price ratios were 4.1x in the 80s and they are now 8.8x. Average house prices have risen over 300% while average.wages have risen by less than 100%. On top of that it is harder to save for a deposit because there is no social housing so everyone is paying private rents.
The average house price is £282k and to afford that on average wages they'd need a 10% deposit, the equivalent of over 8,000 takeaway coffees. Even at 1 coffee a day that's 22 years of stopping ordering takeaway coffees needed to afford a house deposit. Young people drink coffee but people used to go to the pub several times a week and that doesn't really happen anymore. Let's not pretend the older generations didn't spend a penny.
You do realise that to progress up the housing ladder % increases in equity also happened in the desired property we wanted to move to, and margins were therefore raised for older generations too, every generation has had their inflation built in when moving upwards it happens over time, there were property booms in the 80’s and 90’s too, it is not a new thing suffered only by the young of today. Interest rates were often higher as well.
We did without lots built a house out of hand me downs and interest free credit furniture, drove a 10 yr old car, occasional nights out were at friends and families houses talking over a can of 3% supermarket lager and a home made spag bol. Christmas presents were for the kids at first not each other and many of my friends operated similarly, the home was what was important and the bills, not fine dining, a McDonalds was an occasional treat. I did without lunch for 2 yrs till incremental wage increases made a packed lunch affordable, spare money went into savings to progress up the ladder not for holidays and new cars, so don’t pretend you know how easy it was for an earlier generation, you have shown you do not have a clue.
You quote the average house price…. Why? When I was a first time buyer we bought a 2 bed terrace, progressed to a 3 bed, lordy lordy to afford an average house priced home seemed a distant dream, we worked hard saved hard and got a 3 bed semi, eventually through work progression and doing without we finally got a detached as the kids were older only to suffer from the endowment crisis con. Any young person feeling they should be able to access an averaged priced home as a first time buyer needs to understand to do so means sacrifices and saving to get there and time. We lived with parents to build up a deposit rather than pay pte landlords. We had it tough in our own way, you are looking at things through a prism.
You also could flip the depending on where you live argument right on its head.
Looking at rightmove sold prices, the prices of the houses where I bought my first house (2 bed semi reasonable area) have remained broadly static for just about 20 years.
This is pretty standard for homes in the 90-110k category for the TS part of the world and I imagine similar in a lot of postindustrial areas of the country.
It’s difficult to argue that those houses aren’t more affordable than they were. The interest rates now are broadly similar to where they were in that period too.
I realise that not everyone lives in a TS postcode and that in some areas the starting prices are way higher. But I do think that generally people trying to get on the market now do want to do so on a higher rung than those who were buying in the past.
(N.B If you want to see some real house price inflation check out the difference between 20 years ago and 22)
Because I was demonstrating the change over time. The ratio between average wage and average house price has more than doubled making twice as difficult to buy a house today as it was back then. If you earn less than average wage, as most first time buyers do, then you can't afford an average house. That will have been true back then as well but the ratio of wages to house prices is the important bit.
I've never met anyone my age or younger that lives in social housing. There is hardly any social housing there days. People live with parents or in rented accommodation but often people move away far more these days due to university and get jobs in places that means they can't live with parents.
starplayer
Well-known member
When I qualified as a nurse in 1991 I was paid £10200. We bought a terraced house for £33000. A house in the same street now is £80000. If I qualified now my salary would be £30000, so it seems that salaries can keep up with housing stock. As someone mentioned above though, a lot of people now dont want to get on the housing ladder in a street house. That is not the fault of pensioners though.
the_holgate_roof
Well-known member
I just looked up the qualifying years for NI contributions, to compare pension entitlement, it looks like it is 35 yrs contribution for the maximum state pension and it then goes down in parts of 35, so 10 years NI contribution gets you 10/35 of the maximum, so does that mean people who have tossed it off for most of their life don’t get much of a state pension then??
For example: 35 years gives 35/35 x £221.20 = £221.20 a week. 30 years gives 30/35 x £221.20 = £189.60 a week. 10 years gives 10/35 x £221.20 = £63.20 a week.
For example: 35 years gives 35/35 x £221.20 = £221.20 a week. 30 years gives 30/35 x £221.20 = £189.60 a week. 10 years gives 10/35 x £221.20 = £63.20 a week.
When Labour lost the 2010 election what was most pushed into their faces by older people was Gordon Browns derisory 75p per week pension increase. This cost Labour seats and was a big contributor to that defeat
I can see that being repeated at the next election over the heating allowance. The fact that Labour even thought about it will cost them dearly.
I can see that being repeated at the next election over the heating allowance. The fact that Labour even thought about it will cost them dearly.
Yes, they then need to claim benefits.
RedAsABeetroot
Well-known member
And if you're unfortunate enough to be ill and need to go into a care home you can sell your house to pay for that too.
RedAsABeetroot
Well-known member
I agree with a lot of your thread, but the issue of living with parents isn't an option for many locally as there simply aren't the same job opportunities as there were when the likes of ICI and British Steel were major employers. This means that many younger people have to move away to find decent jobs.
On the flipside personal credit was nowhere near as available. I graduated in 1990 having banked with Nat West during my student years. I had about £300 overdraft at the time and no credit card. I told them in July I was starting work in September, earning £10600 (from memory), and they instantly blocked my access to any further funds.
Boro_Interlinked
Well-known member
lol, well you just played into their hands , as students we had preferential access to overdrafts weather free or cheap rate. I told HSBC absolutely nothing until my first pay was in my account at end of Sep 93 after graduating in July and then they moved my status from student account to billy big boy earner account , lol.
chickenrunner
Well-known member
So just like people working in the public sector fail to understand that they don't actually contribute to a pension pot, that their pensions are 'unfunded' and paid for entirely by the taxpayer. Wonder how they'd feel about someone proposing to eff about with their 'terms and conditions'?
Duffman
Well-known member
So where does the 12.5% employee contribution deducted from your public sector salary go to? Also what about the employers 20% contribution? Finally why do I get an update saying where the funding is being invested in by the pensions provider if there isn’t a pension pot?
They do understand it. It's a defined benefit scheme, not defined contribution. It's pretty much the same situation. Current pension contributions pay for existing retirees because previous contributors didn't pay enough. They've changed the NHS pension scheme twice in the last 15 years and not for the better of current employees so the situation doesn't get worse. Employees and employers contribute way more than they used to do.
sambaDTR
Well-known member
Don’t bring in the Private / Public service debate. How much do you think you would pay if there was no tax but had to pay to send your kids to school? Pay to have an A and E appointment? Pay to cross the A19 flyover every day? I’ve worked in both and, as far as wages are concerned, give me the Private sector every time.