Who’s going to pay our pensions in 20-30years if the UK keeps its birth rate low and also restricts immigration?

[AlertEagle]

posted from another forum
Serious question. The UK’s birth rate is well below replacement level, meaning fewer young people entering the workforce. At the same time, the political mood seems pretty anti-immigration, even though immigration is one of the only things that’s kept the tax base stable.

State pensions are paid by current workers’ National Insurance contributions, not some magic fund. So… what happens when there’s a huge retired population and not enough working-age people to support them?

Will the government raise taxes, increase the retirement age, cut pensions, or eventually U-turn on immigration just to prop things up?

Feels like a ticking time bomb no one’s really addressing. Curious what others think, is anyone actually planning for this?

Or are we as a nation willing to give up state pensions if it means less immigration?

Then you have other income that doesn’t derive from a pension. Trust me, your state pension arrives in your bank account untaxed - I know because mine does every four weeks. The money I pay tax on is my income from other sources. If you intend to work until you drop then obviously you’ll pay tax accordingly and if you earn enough to lose your personal allowance you’d be rather foolish to claim the state pension because you clearly don’t need it.

My state pension arrives, untaxed, in my bank account each month BUT, because my annual state pension is OVER my personal tax allowance, HMRC write and ask me for the tax that I owe. I'm expecting to hear any day how much I owe on last year's pension. This will be added to my savings income that is over my Personal Savings Allowance. Believe me, if your state pension is over £12,570 then they'll ask you for the tax.

My tax above my personal allowance is collected from my occupational pension via PAYE, so is my bloke’s. I thought everyone’s was.

So sorry, I misread. Very, very few people’s state pension is more than the personal allowance.

I don't have an occupational pension so no PAYE but I get what you're saying.

I have a very small occupation-related pension on top of my state pension. I get that money after tax. I also still have a tiny job, and I pay tax on that income too. And I/we have saved for 30 years or so into a SIPP, which we haven't touched yet. It owns a commercial property that is returning about 12% per annum; there's quite a lot of money in that fund after 30 years. It's owned over two generations and there are no clear rules about how inheritance tax will be split in our circumstances yet. But we are outliers to HMRC and will be among the last to get advice. So I will worry and argue later, when HMRC send the bill. But I will leave an exhaustive file briefing my heirs on where they stand.

"I’m sorry to disagree but I was 20 and a specialist in pensions visited and briefed everyone at my work" .

Is it really surprising though that a pension specialist, presumably pushing a private pension scheme, would tell people that the state pension won't pay out? Sounds like there is an agenda underway for pensions to be completely privatised along with the NHS as there's not much left that hasn't already been rinsed by vulture capitalists.

@NeedAnyHelpWithThatPaperBag I think your reaction is over the top here. I was also a specialist in pensions, but an analyst not a salesperson, in the USA and 40 years ago, and the reasons for saving into a pension hold true as much now as then. Save under your own name, save as much as you can, and just generally pay attention. Anyone who delegates the decisions to someone else is likely to end up legged over. It is not a decision (or series of decisions) to let anyone else take for you. .

Of course, you may not be offered choices but I still direct the management of two pension funds (both miniscule TBH) plus my own with DH and DC. I spend several hours every week reading and thinking about the best options.

It's a 40 year old story, but when I worked for a pension fund in NY, my boss took a business trip on a quiet commuter flight during an airline go slow. She ended up running a meeting for all the stewards and explaining to them that the low pay was less of an issue long term than the lack of pensions. I don't really know the outcome of that specific situation, but she definitely made them aware of the value of pension rights, and I believe it was a major topic for the relevant union negotiations after that.

It’s like the civil service pension was raised to 67, including prison officers. It’s not realistic to expect people in their late 60s to be working in a prison . Obviously some people will be up to it but lots wouldn’t .

When it comes to workplace pensions though it all depends on who you work for and how many years you do surely?

Well it looks like your pension specialist was almost certainly wrong. I'm ten years older than you and looking to retire in seven years on the full state pension, which humble as it is has at least benefitted from the triple lock for some time now. It seems very unlikely that it's going to go from there to ZERO in the next ten years, particularly as no government authority has indicated (even tentatively, or indirectly) anything of the sort.

You seriously think that some time within the next 17 years the government is going to just suddenly announce that the next year's cohort due for their pension are not going to get one, and that'll be it?

There's a much more obvious explanation for why it would be in the interest of someone selling private pensions to convince people that the state pension won't be there for them. It's surprising it didn't occur to you.

this problem predates immigration, there is simply not enough money.

That's not how money works.

Im not expecting to receive a state pension (I’m 34) and fully planning to fund my own retirement. I know many who are thinking the same. Not ideal but it’s seems like it’s where we’re heading

There is huge amount of research that shows poor people have shorter life spans, its not controversial.

The vast majority of people work or have done but the problem is some people cannot work, no one would employ them, some might with job creation/training but that costs an awful lo of money, which we don't have and offers no guarantees.

I recently drove past a homeless hostel, it was a hot afternoon, large group of men and women hanging around drunk, smoking weed - i don't think you realise how far some long term unemployed are from "normal" people, MH addictions, zero skills....

That's good to hear. I'm starting a new job soon where there's a small pay cut eg 4k but my pension will go from 3% employer contribution to 17% ( its local gov) so youre making it sound like im getting a better deal.