The state pension is HOW MUCH???

[BeatieBourke]

Call me stupid (fair) but I've just realised how much the state pension is. £800 odd a month (£185.15pw).

As a non-means tested benefit. For EVERYONE.

I'm generally of the opinion that benefits are too low and too punitive. I usually advocate for universalism. I understand that people have worked their whole lives and paid in, and deserve a retirement. And that having pensioners in poverty does no favours to the economy or other welfare services.

But £800 a month / £9k a year for EVERYONE?? So a widower in rented accommodation with no other income or savings, £800pm. A wealthy 68 year old who's earned a 6 figure salary, has a huge property portfolio and investments coming out of their ears that pay a fortune out in dividends, £800pm. Seriously?

I understand that no party, least of all the Tories (because tory voters as a population are older) will ever go after pensions because it would be unpopular (and older people vote more generally). But in a time when the country is supposedly facing a financial "black hole" and everything else has already been cut to the bone for the last 12 years, why the hell are we paying out state benefits to millionaires?

Maybe if pensions were means tested (with a fairly high and tapering threshold) there'd be enough to pay pensions for women at 65, and more for people who haven't built up huge assets, can't afford to live, heat their homes or eat a hot meal every day in their later years. I can see the (cynical) political sense in it, but no economic sense whatsoever.

AIBU?

He himself is struggling but he's like a Dad to the single Mum and helps her out a bit. It's a British film.

FFS do people really think like this? What a load of hyperbolic ageist shit.

Decreasing pensions wouldn't help people like you though. Reducing pensions will just mean that when you (and I) eventually reach retirement, we'll be more likely to have an impoverished old age.

You're advocating a race to the bottom.

Give her an allowance then

It's not an extreme example. It's a very common one

I'm not of pension age yet lol.

Grandparents are now crucial childcare for many families. Cutting the state pension will just send many 70 year olds back to at least part time work to try and survive. It will make your life harder.

Quite an interesting read in the documents here:

Pensions: international comparisons

That isn't how the state pension works. It isn't a "savings scheme" for old age - or at least, the one that people currently get isn't. NI and taxes currently being paid pay for state pensions currently paid out. Quite seperately from that, if you have sufficient qualifying years, then when you retire you get a state pension. It's like unemployment benefits. Your NI doesn't "save up" for benefits if you are out of work. But if you are out of work and have enough qualifying years / meet the criteria then you will get unemployment benefits.

It has been sold for years by governments as a savings type scheme for old age.

They're not a lot of use in the city if you'd need a taxi to take you the bus stop in the first place. Lots of pensioners can't walk safely from their homes to the required bus stop.

well if they can't walk to a bus stop, where are they intending to go? To their children's houses?

Indeed but the difference is the government doesn't save/invest the contributions they just spend it.

Civil service pensions are the same. They reduce the pay by a percentage rather than take it out as contributions. Benefits, it makes the scheme appear non contributory (which is true), it lowers the civil servants pensionable salary so lower pension and at the time there were fewer eligible pensioners so they clawed back more from the payroll than they paid out. The last bit has changed as there are now more pensioners. The problem being the money they took back was simply spent rather than invested as suspension scheme. So it's just the way the government works, you pay NI for pensions, benefits, NHS etc but the money is just income to the treasury.

Do bear in mind that pensioners are still subject to taxes (not NI) should their pension income come over the personal allowance. Someone relying just on state pension doesn't come over this personal allowance threshold, whereas someone with both state pension and a personal pension of £20k p.a. will be taxed as if they were earning that £20k + SP of £9k, and will be paying 20% on their pension income above the £12k personal allowance threshold. They don't get all of their pension income tax free (except in very specific and rare circumstances).

It is very hard and costs money to operate a means testing system, plus fluctuating incomes mean that this may change relatively regularly, whereas applying tax bands can be done at source by the pension companies automatically. I doubt that means testing pensions will be brought in any time soon when the tax system can do it much cheaper and easier, and without any external influence, plus is fair and transparent and people are used to it and how it works.

In terms of how much you would have had to save yourself to get an annuity of £9k, currently £100k will buy you an annuity of £5.2k ish; you'd need just under an additional £200k saved into pension pots to fund this £9k income p.a. reduction, assuming that you want to go down the annuity route. If you are looking to take this income away from those with private pensions, the complexities of the taper relief you'd have to apply, plus the duration of the time you'd have to do it in, to allow for those caught by the taper to save more money into their pension, would negate the savings created in the first place.

Also you will have to address the cap on pensions - at the moment you lose tax relief if you put over £1m into your pension pot (yes you can still pay in but the tax on crystallisation means that it's prohibitive and most people stop paying in at this point and put money elsewhere). That additional £200k you'd need if not taking the state pension has to go somewhere. Plus, compound interest really is a thing when dealing with pensions and you need to start as early as possible. Any govt trying to bring this in would have to be thinking 20/25 years in the future - I'm not sure any of them are capable at the moment of thinking further than the next 2 or 3.

You can already defer your state pension if you don't need it / are still working / don't want to take it / want to increase it. Deferring by 52 weeks gets you an additional 5.8% / £10.70 per week.

www.gov.uk/deferring-state-pension/what-you-get

Yes, I was going to make the same point. You certainly can't live on it if you have no other income or assets, and then people need to claim pension credit.

As for rich(er) people, they pay tax on it.

Yep it's like a universal basic income for all the people with the skills, experience and connections to no longer need it while the rest of us starve trying to prop them up

Complete nonsense, lots of elderly people are very badly off. If you have always worked as a cleaner or in a supermarket you're not going to have earned a huge amount. Admittedly some cleaners who work for themselves get a decent hourly rate, but if you work for a company cleaning offices I doubt you get above minimum wage.

The amount of discriminatory ageism on mumsnet is vile

I think that it would be more beneficial to compare what we, the UK pay to other people within our own economy rather than comparing what other people pay within their economies.
We pay OAPs quite a bit compared to what we pay other people.

That's the comparison we should be looking at.

The amount of sweeping accusations of discrimination on mumsnet is vile.

Give me a handful of examples of 'ageism' on this thread?

the people who work all there life and contribute deserve a state pension , what about the folk who’ve never contributed and get the same , it should be paid as a percentage of the individuals contributions made

If someone has never contributed, there is probably a reason.

Yes, better that pensioners carry on working, just as most UC recipients are doing. That would make it comparable and fair.

But wait, hang on a minute - that would mean that pensioners would be taking jobs that younger people with families would need....

Oh dear, might need to think that through again.

My MIL gave up work at 26 to raise two DC, and now in her 80's never worked a day again in her life.
FIL earned enough so she didn't have to. He retired at 55 and is now 83.

We will all be pensioners one day. Making things worse for them now means making things worse for our future selves.