Not contributing towards a pension is at best foolish and at worst utter stupidity?

[BHouse19]

I was really surprised (and concerned) having met with a large group of friends last night that some of them aren't contributing towards a pension (two stay at home mums for two + years and one who has opted out of her work place pension).

So I'm just wondering, if you're not contributing, how are you planning to survive during your retirement? Projections tell us that the state pension (if it still exists as we now recognise it) is in no way going to keep up with inflation.

Your husband or wife may be contributing to one but if the marriage breaks down the value of this to you is going to dramatically reduce for you as a single person

AIBU in thinking that saving for a pension is one of our most important financial responsibilities?

It depends on circumstance. If you are able to add each month but choose not to just so you have an extra few quid on crap you don't need then absolutely. I used to work for a company with a VERY generous pension scheme, I worked with someone in their early 20's who reduced their contribution as much as possible just because they wanted a few extra quid; they didn't need it and admitted that they just frittered it away every month. However, to someone who needs the money to pay the bills every month, then it is not unreasonable.

Not everyone can afford to pay into a pension.

I am, but I'm on a low wage so it's not a lot.

I am buying a house next year and should be mortgage free in 20 years, by which time I will be 50. I will then plow most of my salary into my pension.

I don't expect to retire before state pension age (if there is one by then). Luckily I do office work so it's quite sedentary.

Not always that simple @andpancakesforbreakfast I work in a company with very little scope for me to advance but I stick it out because it's VERY flexible which is hard to find. I have to suck up the no advancement so I can collect my kids from school, work from home when needed etc as I have no help.

I’m sure you’re correct in thinking that foolish or stupid people don’t pay into a pension. But people who don’t pay into a pension aren’t all foolish or stupid.

I would suggest that they are covered in some way by their national insurance contributions

What does that mean though? Yes people on low incomes may be paying their NI contributions, but all it determines is your eligibility for the state pension. Which any future government could change the rules on (although it would be v unpopular). But that's why many say don't rely on the state pension and try to ensure you have some other form of retirement income in place.

Future governments could remove the triple lock, or push the retirement age up further to 75 for example. The fact you've paid NI doesn't 'cover' you for anything if that happens.

I haven't paid into my pension since 2015 as 12% was taken out of my wages (I'm Head of English in a school) and it was £475 a month I needed to pay towards my bills and childcare. I would have much preferred to pay a smaller % but had no choice. We have recently moved to a cheaper area so I'm hoping to rejoin my pension scheme next year. I have worked since 16 and paid into a pension from then. I stopped paying into the teachers pension when I was 28. At it stands, my pension is worth £500 a month. I also own a second property which I'll hopefully get a lump sum of at least £70,000 from. I will restart my pension next year and hope to eventually have a private pension income of around £2000 a month. My husband has a good pension so I'll benefit from that too. I'm not worried as weve had to do what's needed to house and feed our children.

I'm not an idiot or foolish. I am also hard working and sensible, just like you OP.

If I went into my workplace pension, with a contribution of 16%, I would not be able to afford food on top of my pension, bills, travel etc. I work in the public sector and love my job, although it pays poorly.

Quite insulting to insinuate the only reason a person isn't in a workplace pension is through stupidity.

@DeathStare

Being hard-working and sensible doesn't make a pension affordable. Privilege does

I didn't feel particularly privileged when I had little to no money and was paying for the privilege of waking up at 5am to drive across the country to various nursing placements to work 37.5 free hours for the NHS for 3 years. Or all of the times I've been working 14 hour days only to go home and spend the next 12 hours on call and being disturbed multiple times through the night. Or when I was pregnant and working an additional 12 hour shift most weeks to cover the shortfall in salary over my maternity leave.

I suppose what I'm saying is that you can call me privileged and use that in part as justification as to why I'm taking responsible steps towards my future and you (presumably) are not but that misguided mentality won't keep a roof over your head or food on the table come retirement.

@JorisBonson if you can't afford your workplace pension you could consider setting up a personal pension with smaller contributions

I never understand that kind of comment. Yes, it happens, and a lot of us have been in crap companies, but YOU make the choice of staying whilst others work hard to work somewhere else. It's not good fortune not to settle and not stop until you find a decent job.

Which a lot of people (myself included, hence 'worked') do. But in the context of the OP's "I got myself a promotion and worked extra hours before having a baby" comment, it demonstrates her blindness to her privilege that she didn't have to do that - she didn't have to change employers, potentially abandon one pension scheme and begin afresh in another (which may have worse terms), establish herself in a new post, figure out whether this was the right employer for her or was she going to have to move on again, work long enough to be entitled to full maternity pay yadda yadda yadda. Her post reads very much like "I got to where I am entirely through hard work and sensible choices, and anyone who doesn't make the same choices as me is therefore obviously lazy and feckless" without any apparent awareness or acknowledgement that you can work hard and be sensible and still benefit from some good fortune, or that you can work hard and be sensible and still end up in a shitty financial position through relationship breakdown, redundancy, disability etc.

@BHouse19 don't even begin to try and justify your own life. That's one of the more inimical bits about this place. Nobody works hard and reaps the rewards. They are just lucky and don't understand what it is to not have those opportunities.

DH and I made similar choices, still do. His family pull all the "It's alright for you" shite, a lot. He has offered them a start working with him, standing on the side of motorways and railway lines at 3 am in December; 7 day weeks, 50+ hours a week, working away for weeks / months on end. So far he has had no takers!

NOBODY has to justify what choices they mad, or ddn't make, to get to any life stage. But it woudl be nice if everyone stopped poking at those who had different opportunities, as though they were a personal affront!

I joined the Pension Scheme at 18 when I started work because my mum told me to .
42 years of contributions later I have been able to retire from a job I was finding increasingly stressful.
I never ‘missed’ the money because I had never had it and you won’t believe how quickly the time has gone.

@Waxonwaxoff0

Not everyone can afford to pay into a pension.

I am, but I'm on a low wage so it's not a lot.

A little is so much better than nothing

I am a WASPI (63) but have works pensions and DH good pension and state pension. God forbid if I was left a widow I would get half of his pension. House is fully paid up. Another thread I read is that many women my age have to turn to the job centre and all that entails.

Maybe they can't afford to? I live in Spain, not the UK and although I do contribute to a state pension I don't have a private pension because I scrape by as it is and I can't afford it. I would if I could.
Luckily the mortgage will pay off 2 years before retirement and at least i won't be renting in old age, but it's not great. But it's all I can do.

As PP have said, it’s difficult though when some people are working full time yet relying on food banks to feed their children; you can’t really even say to them “please put £10-20 aside for you to use in 40 years time”. The concept of saving themselves from poverty in old age means nothing when people are genuinely living in poverty now.

My thoughts exactly. It's true that some people prefer to treat themselves to lots of luxuries now instead of making provision for their retirement, but for millions of people out there, it's just a pure impossibility.

I think the same when I see those irritating Nationwide adverts, telling us that saving is easy if you do it on the day you're paid. I'm just waiting for their follow-up advert where they tell us how you can live on fresh air and get your mortgage provider/landlord and local council to let you off paying for the last week of every month, because you basically saved THEIR money for yourself.

You might as well ask why people are foolish and display utter stupidity in throwing money away on rent each month, rather than magically having a huge deposit and securing themselves a guaranteed mortgage when they apply for it. In fact, having a mortgage and paying all of that interest is pretty stupid, isn't it, when you're fully legally entitled to just hand over hundreds of thousands of pounds upfront to get yourself a house, without having to ever pay any interest at all....

This also makes the broad assumption that everybody is in good health and will remain so into a good old age. I have a progressively-worsening lifelong health condition which seriously impacts on my ability to earn a good wage as it is. Should I make things even harder for my family and me by salting away much-needed money now into a pension which I'll almost certainly never live long enough to claim?

Even reaching any kind of standard retirement age is a privilege, let alone having left over money available now to be able to save for it.

‘ AIBU in thinking that saving for a pension is one of our most important financial responsibilities?’

Yes you are being unreasonable.
You’re very lucky if you manage to reach retirement age these days. Sadly no one in my family seems to reach beyond the age of 70.

i ticked YANBU becuase for those can contribute I believe it is foolish not to have some sort of provision for old age.

However, I truthfully believe that there are plenty of people who genuinely cannot for lots of really valid reasons. For these people I really feel for them

House19

I am not talking about myself but have you any idea how many people struggle to live. I'm always amazed how many women on here are so concerned about other people's pension and savings.

Instead we need to look more widely at a system that allows people to work bloody hard all their lives, to always live hand-to-mouth, and to never be able to afford to retire.

Agree with Deathstare. When I was young, there was no option to opt out of an employer pension scheme if they had one. I wasn’t well paid but I paid very little rent compared with amounts today.

I didn’t take the tone of the post as sneery though, just an honest attempt to ask what we can do as women to help people plan for retirement, recognising that women tend to have less pension provision than men. I think the problem is that we have moved from a society in which almost everyone was entitled to the basic state pension to one in which very many are not. The state pension has not increased in line with inflation either. However, few people recognise this and even if they do they have very little spare cash to save. I have noticed that many posters don’t know about voluntary NI contributions or NI contributions if they are caring.

I was especially sad to see the posts about NHS pensions. That was one of the few areas where, in a predominantly female workforce, staff could at least rely on a reasonable occupational pension. No wonder the NHS has recruitment problems if staff are unable/can’t afford to pay into the scheme.

But it woudl be nice if everyone stopped poking at those who had different opportunities, as though they were a personal affront!

It's perfectly possible to say something like "I worked hard, I tried to make sensible choices, I also appreciate I was lucky to benefit from a good education / stable relationship / financially literate parents who taught me about money / considerate employer [or whatever] and I did my best to make the most of the opportunities that offered and to seek out new ones". It's when someone comes across all "I worked hard and made sensible choices so why can't everyone else simply do the same, anyone who doesn't is just stupid?" that it starts to get people's backs up, because it is smug and judgemental.

@BHouse19

I barely make ends meet every month after taking care of mortgage and bills. How do you propose I then put money away into a private pension?

It really isn't as black and white as you think.

YABVU to call people foolish and stupid. My DM could not afford her work pension until she was in her mid 30's because of childcare costs and she was advised to pay heavily into a private one by a financial adviser who had been in the family for years. After 18 years that went bust and she lost everything. She was made redundant aged 61 from a professional career and could not even get retail work with thankfully savings to live on, but her state pension did not kick in until 67. Instead of being very comfortable in her pension years as she envisaged, she is just getting by.

*hey will have 0 assets and their rent will cost more than their state pension.

It makes no sense.*

Your right and it’s going to be a welfare state nightmare that’s being ignored.

However, when 75% of your income is going on rent, it leaves little to save for a pension. Your fire fighting the bills, and that’s where I am.

YABU. I have never been in the position to afford to pay into a pension and still be able to live. Not everyone has a 'career' or a job that pays well enough. I suppose that makes me feckless, or some such.