To think this is a real possibility in the future? (State pension)

[TheOtherBoleynSister]

I am 34 and ever since I started working people have said don’t rely on there being a state pension. So I’m pretty pessimistic about it.

I honestly believe that for people under 40, the universal state pension (paid regardless of income or capital to those who have paid NI for a certain number of years) won’t exist. That there will be no qualifying ‘age’, and instead older people will be the same as the rest of the population when it comes to benefit eligibility ie. Have to be certified as too ill or physically unable to work, and get UC if income is low and savings are below £16k. In other words, being a certain age won’t entitle us to any benefit like it does now.

In this awful very bleak future, older people who can no longer work, who have savings/money above the threshold or private pensions, will need to rely solely on the money they have unless or until they get to the point where they now qualify for benefits.

Of course I don’t want this to happen, but with all the stories about the cost of pensions and the rising number of older people it feels inevitable. But the reality is many people’s private pensions won’t be nearly enough to last (but maybe they will be forced to spend them before any help), and there’s also talk in the press of some wanting to do away with ‘generous’ public sector pensions (which are not as generous as they used to be, albeit they are better than a lot of private schemes).

I am quite aware of pensions due to older relatives and friends who are of that age, but many people my age haven’t a clue about them or how they work. I do think we will be seeing a real disaster in less than 30 years, but people don’t care as it’s someone else’s/ tomorrow’s problem.

still more than working people often get - who also pay council tax!

I don't know, OP - I agree it will be an issue but more along the lines of 'pension age keeps rising' (to the point where barely anyone will actually still be able to work full time and so will be trying to fund the in-between years from, say, 65-75 somehow - probably via being signed off as unfit to work) rather than abolished completely - just because the backlash of people who have already paid in for years and the prospective legal challenges will be too much aggro for any govt to approve it.

We have to bear in mind that we're hardly alone in this - nearly every country in europe will be the same. Look at the outcry in france when they had to push forward the reform to age 64, which is still the lowest in europe - how are they supposed to fund that? They have a similar aging population, low youth employment, etc. to us.

A huge amount of pensioners today are leaving hundreds of thousands of pounds to their descendants. If reducing state pension means instead people spend that money themselves - we'd have to get better means of equity release/back owing costs etc. so people can stay in their own homes, rather than be cash poor but sitting on a quarter of a million investment - on the face of it that isn't a bad thing, albeit would stick in the craw against people who have never/rarely worked. But that's the case now.

I also think that the amounts pension companies forecast for what they think is a minimum/standard way of living is vastly inflated as well - which makes sense because obviously they have a vested interest!

e.g. Retirement Living Standards suggest a couple need £60,600 for a comfortable retirement, £43,900 for a moderate one - but according to ONS last year "Median equivalised household income in the UK before taxes and benefits was £38,900, increasing to £41,900 after taxes and benefits."

So it makes no sense that people "need" twenty grant a year extra to have a comfortable retirement than the average person gets by on when working full time - particularly given 'the aim' is to not be supporting dependents, paying off a mortgage/for childcare, commuting costs, saving for retirement (i.e., all the highest outlays) etc. by then. Obviously there will be some in better positions and some in worse, and potentially additional costs like care, etc. But even taking all that into account, it will be perfectly possible for most people to have a decent retirement, if they accept they'll need to actually spend their savings rather than trying to hold onto them to pass on to their kids.

I’ve long resigned myself to being screwed in old age. I’ll likely be on sickness benefits if they scrap the pension.

I started work at 16. There was no such thing as auto enrolment back then. I worked in low paid jobs like shops and other small businesses. No one ever really mentioned pensions. I’d heard of the old age pension so naively assumed that was just what everyone had and it was fine. As lovely as my parents were, they never taught me about pensions etc.

I was 25 before I’d started a “career” as such. And this was a self employed career. So still no company pension. Starting a private pension never really crossed my mind. Again it was just naivety, not deliberate. I was saving for a house deposit anyway so was prioritising that more than anything. Managed to get myself my small flat aged 32.

Met my now husband when I was 34. We knew we wanted a family so when we knew we were serious we started saving to move to a bigger house. Finally got one and done it up etc and had got married. Aged 37 now and we’d been trying for a baby for a year with no success. Had investigations but nothing “wrong”. Was offered NHS referral for one round of IVF but after a few cancelled appointments time was ticking so we went private. We ended up spending 50k on tests and multiple rounds of IVF over the next few years until we gave up. So all our savings were gone and we had a bigger house with a mortgage that we’d spent money on.

6 years down the line since we gave up trying for a baby we’re almost back on track with money/debt. But we’re mid-late 40s now. And I still have no pension. (My husband does but it’s very low as he also only was able to get a workplace one when it became compulsory. And his employer contributes the minimum).

We decided a while back that our house would be our “pension”. We’ll happily sell up and downsize and live off the proceeds. But then you hear people saying property prices will crash. If they do then we won’t even have that. In that case I’ll be on sickness benefits. I already struggle with work due to severe back issues (caused by work). I sometimes get home from work and just lay on the floor for an hour to relieve the pain. I’m not even 50 yet. If anyone thinks I can still be working in 20 years they’re having a laugh. Yes I could change career. But as everyone knows, it’s not really that easy these days. Jobs are short in supply. Most places would rather not hire an almost 50 year old with no experience would they let’s face it.

Most don’t save to supplement everyday costs of living, they save so that they can go on holiday, pursue hobbies, private dental care, possibly private health care if placed on a long waiting list for hop replacement etc, big unexpected expenses like new roof, replace kitchen, car, help children out, etc

I also think that the amounts pension companies forecast for what they think is a minimum/standard way of living is vastly inflated as well - which makes sense because obviously they have a vested interest! e.g. Retirement Living Standards suggest a couple need £60,600 for a comfortable retirement, £43,900 for a moderate one - but according to ONS last year "Median equivalised household income in the UK before taxes and benefits was £38,900, increasing to £41,900 after taxes and benefits.”

@tokennamechange
I think that the forecast spending are quite low not vastly inflated. First comfortable doesn’t mean average, whereas moderate does so it makes perfect sense that a moderate retirement would be close to the average household income.
“The figures show how much someone may spend at retirement across three different living standards, they are an estimated expenditure, not an income. They assume you own your own home with no mortgage so you may need to add or reduce other costs depending on your circumstances, such as mortgage, rent or social care costs and any income tax on your pension. Also remember, your income may be taxed, so plan for that too.
The Standards aim to offer a clear and realistic view of people’s retirement spending in the UK, helping you use your current lifestyle and cost of living as a guide for what you might need in the future.”
https://www.retirementlivingstandards.org.uk/

People could work part time to top up the UBI and have more free time

We need the right kind of immigration, i.e. skills shortage workers, highly paid workers, etc., the kind of people who will contribute to the UK.

We don't need the black economy workers, just eat riders, hand car washers, criminals, those wanting a life on benefits unwilling to work etc.

There's a difference!

Income tax rates will have to be sky high to pay for UB, so will there really be lots of people willing to work for a very low "take home" pay, bearing in mind other work related costs such as childcare, commuting, etc??

You don't seriously think there'd still be a £12.5k tax free allowance and basic rate tax at only 20% do you??

You're not eligible for it yet! In another 7 years' depending on which muppet is Chancellor, it's still possible for it to be means tested, especially if we have to go cap in hand to the IMF for emergency loans and they impose tax/benefit changes upon the UK as a condition of funding!

Nope. Even in the range where the tax free personal allowance is tapered away, the marginal rate of income is 60%, so for every extra pound earned, the recipient keeps 40%.

So, say, a pensioner on £100k of occupational pension. S/he gets to keep £4k of the extra £10k state pension, so IS better off due to the state pension.

They're NOT worse off due to receiving more income, i.e. the state pension.

No it isn’t possible because legislation was passed after the Waspi debacle so that any changes in the state pension can only be effected with a minimum of ten years notice. The IMF could only impose savings in public expenditure not specify how they’re made. Anyway they’d have to go to Italy and France first, their national debt is a far higher percentage of GDP than ours.

It's not just GDP that matters. The UK's cost of borrowing (interest rate) on government debt is currently higher than Italy and France, meaning the money markets have more confidence in France and Italy than the UK. The current interest rate on money markets for the UK is actually higher than it was under Liz Truss!!

Also remember that inflation and wars erode a pension.

I keep fit and am planning to live to live to 90, but yep, who knows.

Unless leadership changes dramatically then you will be guarded with the rules in place now. Always best advice, given my previous generations, is to pay into work pension as you can get this before state pension. Xxx

I posted but to add if on UC there is pension credit to help with rent etc which follows on from UC so a smooth process.

You will be fine

Yeah because Elon Musk and co will be dying to share their trillions in profits with the needy.

If AI takes off the way some people expect it to, they’ll have us over a barrel. It will completely change the power dynamics.

We can do out best to keep healthy but you can plan on how long you live. I know lots of people who died before or soon age and they didn’t plan it

The power dynamics will be the same as they’ve always been - the uber wealthy screwing over everyone else.

That's actually quite a bit of my day if I'm honest. There's only so much practical or useful stuff I can do before I run out. Especially in winter.
I shop, cook, launder, stroke the dog.
I leave wasting my time in front of the TV until evening.
It's 725 and I'm scrolling. I'll go off to parkrun in an hour but that's all I've got on.

The naivety of people born into the nanny state always surprises me

When did the nanny state start? The birth of the NHS? peak building of council housing?

e.g. Retirement Living Standards suggest a couple need £60,600 for a comfortable retirement, £43,900 for a moderate one - but according to ONS last year "Median equivalised household income in the UK before taxes and benefits was £38,900, increasing to £41,900 after taxes and benefits."
So it makes no sense that people "need" twenty grant a year extra to have a comfortable retirement than the average person gets by on when working full time -

The median household figures aren’t for someone working full time. The ONS average for a fulltime worker was £39000 last year. So if a couple were both average earners they’d be on considerably more than the comfortable retired couple, let alone the retired average couple.

It doesn’t seem to me that a couple who want an above average retirement in terms of spending (and the 60k lifestyle is not lavish) will want more between them than a single average salary. The illustrations are to help people plan, including when to retire.

Indeed. Keeping "fit and healthy" improves your chances of a fit and healthy long retirement, but there are no guarantees. My DH has always been fit and healthy, never overweight, always active with various sports etc., but has been struck down with an incurable cancer that has NO known lifestyle causes in his early 50's! My father was likewise fit and healthy but was killed in his early 60s due to NHS medical negligence complications arising from a simple operation. My mother was fit and healthy but struck down with dementia in her 70s. You can look after yourself to improve your chances of a long and healthy retirement, but there are no guarantees. Far better to live life as much as possible, as young as possible rather than working/saving hard in the hope of a good retirement as often it simply never happens when you finally give up the daily grind of work.

Exactly. And we need to make these contracts temporary with temporary accommodation. What we're doing now is removing the young workers from poorer countries, and keeping them here where they will compete with our own children and undercut their wages. Young nurses and engineers are leaving the UK and Ireland because they can't afford to live here but people from other parts of the world are willing to work for less, live in substandard conditions and raise large families with the help of taxpayers (schools, medical expenses, rent all paid out of public funds). Soon they will buy houses, land, businesses. They will own our countries and they will remind us that we are living off them.

🙄😏