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To think that a lot of people don't seem to understand that part-time work = much smaller pension?

(175 Posts)
AHedgehogCanNeverBeBuggered Tue 06-Feb-18 19:09:09

I work with a lot of women in their 50s, several of whom have expressed their shock/disgust at how little occupational pension they'll be receiving when they retire, even proportionally compared to FT workers. They have all had DC then remained PT even after the DC became teenagers and eventually left for uni. I didn't want to say anything to them when they were complaining to me how hard done by they are, but surely it's basic maths to know that the more you invest (and the earlier) the more it grows and therefore the greater the pension? How can they now claim to be so surprised and hard done by?

SuburbanRhonda Tue 06-Feb-18 19:10:49

You know lots of women in their 50s who work part-time and they all moan about their small pensions to you?

What a coincidence.

werewolfhowls Tue 06-Feb-18 19:12:53

I'd rather have the part time hours here now in my thirties to actually see my children, and be poor later. Thinking of overpaying in my fifties on full time when kids are older

OnlyTheDepthVaries Tue 06-Feb-18 19:19:01

I have worked part time for the past 20 years...since my first child was born. My pension has been affected by this choice..and this was something I considered, evaluated and accepted when I chose to reduce my working hours.
Not all part time, fifty something women have buried their heads in the sand or are surprised by the reduced pension. We are not all thick.

AssassinatedBeauty Tue 06-Feb-18 19:24:21

Some people are not very financially literate, some might have misjudged the level of their contributions and not accounted sufficiently for inflation. I don't think it's necessarily typical of part time women in their 50s.

Fattymcfaterson Tue 06-Feb-18 19:32:32

I think people are living in lala land if they think there is going to be any kind of decent state pension for the generations now below 40

Babbitywabbit Tue 06-Feb-18 19:32:36

Yanbu - I work in education and loads of women in my age group (50s) never returned to full time work after having kids and it’s only just dawning on them that their pensions are crap.

Nothing wrong with working p/t if you weigh it up and decide that’s what suits you- but the figures speak for themselves. A hugely disproportionate number of women are set for an impoverished older age because they haven’t paid enough in. The other thing that never fails to surprise me (considering these are intelligent women I work alongside) is how many of them don’t realise that if their husband predeceases them (which is statistically more likely) they won’t get all his pension. I personally know of a handful of women who’ve said well it’s ok, my husband has a great pension, and genuinely had no idea that they won’t get it all!

AssassinatedBeauty Tue 06-Feb-18 19:34:56

@Babbitywabbit what proportion do widows get of their spouse's pension?

SpiritedLondon Tue 06-Feb-18 19:42:13

Well they get credit for at least working! grinJust a joke. I guess they never bothered to get their husbands to explain it to them

lostherenow Tue 06-Feb-18 19:50:58

The thing is though that women around 50-60 are being hit by these state pension age changes aren't they? So not only are they now realising that their occupation pension isn't worth much but the state pension they were promised at 60 is now going to wait until 67 or 68.

I think there is an age group between the baby boomers (who expected a lot and got it) and the younger people (like under 40 now) who know they aren't going to get anything in terms of state pension. The in-betweens who were promised a lot and now aren't getting it. So while I think its a bit of lack of financial understanding in some ways I think they have been a bit hard done by.

AmberTopaz Tue 06-Feb-18 19:53:37

I think this is a widespread problem. Many people aren’t paying enough into their pension, not just 50yo women.

Lovelylovelyladies Tue 06-Feb-18 19:57:28

I don't even work so I guess I am fucked in 40 years time.
Uh oh!

AHedgehogCanNeverBeBuggered Tue 06-Feb-18 19:57:40

Not all part time, fifty something women have buried their heads in the sand or are surprised by the reduced pension. We are not all thick.

hmm

I never said you were! Like I said, this is 3 women in my office who are all intelligent people, they just seem very surprised by their pension statements.

Believeitornot Tue 06-Feb-18 20:00:43

I thought there were the waspies campaign which highlighted an issue because they were caught out by a change in rules?

As for state pensions generally - well it’s no coincidence that MPs, rich bosses and unionised staff have pensions.

If we had decent unions for all then there’s would be better pensions all around. More wealth spread around.

WTFIsThisVirus Tue 06-Feb-18 20:03:00

I think people are living in lala land if they think there is going to be any kind of decent state pension for the generations now below 40

The state pension isn't even decent now to be honest! sad

I'm sure not everyone considers the financial implications at the time. To be honest, when deciding to work full time, my main motivation was my career; I didn't even think about my pension.

Babbitywabbit Tue 06-Feb-18 20:13:01

Assassinatedbeauty- your response kind of exemplifies the problem! There isn’t one definitive answer to how much a spouse would get on the death of their partner- it depends on the scheme. But it sure as hell ain’t all of it! It’s scary how many people aren’t aware of these things.

Dh and I would each get half of each other’s pensions which is pretty generous and we both have final salary pensions which are increasingly rare. . As a top up to my own pension, half my dhs would be ok, and vice versa, but no way would I want to rely on just a proportion of dh’s.

G1ggleloop Tue 06-Feb-18 20:30:39

I agree. I've seen lots of older women in my line of work carrying on until they are 65 when most of the men retire at 55/60 as they need to make up the deficit from the long years of part time work. This is why I am reluctantly returning to full time work once my youngest is in school. There seems little point in sitting at home when all the kids are at school when I can be earning and have more to spend on my days off and during my annual leave plus I can still afford to retire early. All being well that is. You can never predict the future.

AHedgehogCanNeverBeBuggered Tue 06-Feb-18 20:32:48

So not only are they now realising that their occupation pension isn't worth much but the state pension they were promised at 60 is now going to wait until 67 or 68

To be fair, the information about the rise in State Pension age has been disseminated via massive ad campaigns and mainstream news, as well as individual letters, since the late 1990s. Anyone who says they didn't know is either a complete eejit or an ostrich.

Allthewaves Tue 06-Feb-18 20:34:07

I worry about this so we are scraping extra into a private pension

user1490465531 Tue 06-Feb-18 20:38:37

Well you may not even make old age....
Retirement age will probably take you to your death anyway as it's forever increasing so a year after retirement we will probably drop down dead no need to worry about a pension then.

Sn0wSn0w Tue 06-Feb-18 20:48:45

When you are young talking and planning pensions is "boring"
However as you get older the planning becomes necessary

Some women I know in their 60s have said that pensions were never offered/allowed to women at the start of their working career

The Government has recently introduced schemes that if you work for an employer, that you are auto enrolled into a pension and it is your choice if you opt out. Your employer may also contribute some money your pension.

Some people cannot afford to save for a private pension

You can check your state pension forecast on the HMRC website using your National Insurance number

I know some people who dont contribute much to their private pension, but have invested in other things

People are living longer, so there needs to be more education about saving/planning for retirement for everyone
Retire 68
Live until 88 ?
20 years

BubblesBubblesBubbles Tue 06-Feb-18 21:02:54

I am fully aware that being part time has affected my pension. I do however have over 8 years in a final salary at full time wages and the rest is average earnings and index linked.

It was a decision that I made for my children. I wanted to be home with them, as much as I could.

My dc2 will be going to school in September, so I am currently debating on upping my hours or going back full time. As a family we have to weigh up the pros and cons of both of us working full time.

If I continue part time we need to work out a way to start paying into savings to invest.

My mums who’s late 50’s has a really poor pension prediction (worked part time in a low paid job till we were all in school as 4 lots of childcare would have wiped out any money she made) and I wouldn’t say she’s shocked but is certainly making extra payments now.

Babbitywabbit Tue 06-Feb-18 21:07:55

Bubbles- I think the OP was referring more to women who remain part time for years and years, even after their children are in school or grown up. Like you, I worked part time while my dc were tiny because it weighed up that I’d prefer to take the hit on my pension for a small number of years for the trade off of more time at home. But I went back to full time the term by youngest turned 4 and joined reception class, and I’m so glad I did because my pension would be shot to bits otherwise.

AssassinatedBeauty Tue 06-Feb-18 21:13:15

@Babbitywabbit I'm not married so it's not something that would apply to me. I wondered if there was a standard amount that is typical that widows would get from their husband's pension, that was all. I can't seem to find anything out about this proportion that widows would get - do you know of a website that explains it?

meredintofpandiculation Tue 06-Feb-18 21:17:36

To be fair, the information about the rise in State Pension age has been disseminated via massive ad campaigns and mainstream news, as well as individual letters, since the late 1990s. Anyone who says they didn't know is either a complete eejit or an ostrich. There was very good information about the first rise, the one that did a graduated rising from 60 to 65. The second one, that took the pension age even higher, wasn't anywhere near so well advertised, and it had much shorter notice.

Sn0wSn0w I think is right in saying that women didn't necessarily have a right to be in a pension scheme - I have a vague memory of that. Certainly when I returned part time after my first, I would have been excluded from the pension scheme had I worked fewer than 16 hours, and that of course affected women more than men, which is one of the reasons that part time workers ended up having pension rights.

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