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Original poster

Would you be bothered if your DP wasn't fussed about paying into a work pension?

30 replies

hawleybits · 09/12/2014 17:46

DP and I have been together for over a year and do not live together, although have talked about a possible future. We've never been nosey regarding one another's finances and he's always seemed fairly responsible where money is concerned.

It's recently come to light, he is opting out of his company (contributory) pension scheme as he says he can't worry about paying into a private pension and needs all his wages to survive - he does have two dc. I too have two dc and do a similar job, earning a smaller salary but still pay into a pension.

I'm beginning to feel a bit uneasy about all this. It's none of my business now but could be in the future.

How would you feel about it? Is it a concern or should I accept his view? He doesn't have any sort of pension.

He's in his forties BTW so not young in terms of thinking ahead.

OP posts:

InfinitySeven · 09/12/2014 17:50

My DP does, and he's 26. His dad told him how important it is, so he doesn't see it as a cancel able thing. He puts 8% in, and his work match it, I think.

I don't think I'd be too happy if he had just brazenly decided not to have one, but it sounds like your DP has thought about it but doesn't think he can afford it. And after a year, if you don't have joint finances, I'm not sure you get much of a say.

Does he have a plan for starting a pension? Does he know how small the state pension is?

Ragwort · 09/12/2014 17:56

I don't think I'd be sharing any future financial arrangements with someone who didn't save ............... if he's a 'boyfriend' rather than a live in partner then you don't really have any say in the matter.

My DH and I have always been very careful about savings and investments - managed to pay off our mortgage in our early 40s - and we started a pension for our son with child benefit as soon as he was born.

It's always hard to comment on other people's spending, lots of people I know say they 'can't afford a pension/savings/school trip/whatever' but then seen to have a new car every couple of years, latest ipad and wear designer clothes. thinking of my brother

But perhaps we are boring and mean .

Original poster

hawleybits · 09/12/2014 21:32

Not boring or mean Ragwort. I agree with you.

He isn't a live-in partner so no, I don't have a say but it doesn't stop me having an opinion. He'd like to save but says he can't at the moment and he's not one for splashing cash on stuff for himself. I manage to save in a similar position to him - it all about priorities for me.

I want to know I'll have more than a meagre state pension when I retire, that's even if such a thing exists by then!

Infinity, DP has no plan to start a pension as far as I know - he is in the process of actively opting out (just started new job) and he had no pension before that either. I'm certain he's well aware of the state pension situation but chooses to ignore it.

OP posts:

sanfairyanne · 09/12/2014 21:37

how long is he likely to live for? manual job up north or middle management down south can be 20 years difference. if only 67 or so, whats the point?

WalkingInaWhippetWonderland · 10/12/2014 08:53

Hi Hawleybits. I think you posted this in chat. Good idea to post in money.
If as you say he has no other incomes/investments/pensions, then yes I'd be bothered if it got more serious, like living together.
We are planners and always have an eye on how quickly can we get rid of the mortgage, what do we need to save for retirement etc. but also living and enjoying the now.
Can he opt back in at any time, maybe when he gets a pay rise?

specialsubject · 10/12/2014 12:46

what will he live on when he stops working?

as you say, not your problem at the moment. But if this is going to end in a live-in partnership, it could be.

TalkinPeace · 10/12/2014 14:50

DH and I only started putting money into our pensions this year.
We are pushing 50, both self employed
neither plan to fully stop working ever

we have other sources of savings and income though

Hoppinggreen · 10/12/2014 16:36

As an ex financial adviser I can tell you that we were legally bound to advise people to always join a works pension if one was available.
The employer will be paying in as well and his contributions will be taken out before tax so he s getting " free" money effectively there.
Despite all this it's his decision - even if it's the wrong one ( unless he really really can't even afford a minimal amount)

Original poster

hawleybits · 10/12/2014 18:53

Sadly Whippet, I think that if he opts out, there will never be a good time for him to opt back in again.

My thoughts are to see how it goes and whether he can manage without that money each month. He might find he won't miss it too much, rather than, filling in the form to opt out in the first month without giving it a try.

OP posts:

atticusclaw · 10/12/2014 18:57

He's crazy if he doesn't take free tax free money from his employer. He should put a bit in, even if its small.

WalkingInaWhippetWonderland · 11/12/2014 10:54

Then could you talk to him and advise he takes on the pension and perhaps offer to help him make cuts elsewhere?
For e.g we just renewed our house insurance and saved £100 by making one phone call.
If you say he's "fairly responsible where money's concerned", he may not take much persuading.

OhBuggeringBollocks · 11/12/2014 10:57

Crazy unless he has other investments that will provide for a retirement imo

Original poster

hawleybits · 11/12/2014 18:16

When he first told me his plan to opt out I said what I thought but he made his point clear. I'm the one who has brooded since but still feel it's entirely his business ATM but I'm thinking my retirement will not be enhanced by his lack of provision and that's not something that makes me happy.

To bring the issue up again, feels like I'm being mercenary - which I suppose I actually am.

I'd also very much doubt he has house contents insurance either...

OP posts:

Pensionerpeep · 11/12/2014 22:04

This reply has been deleted

Message withdrawn at poster's request.

Original poster

hawleybits · 11/12/2014 22:36

Pensionerpeep, I'm beginning to think along those lines.

OP posts:

Screenclean · 12/12/2014 18:21

Do you think he's hoping for a big inheritance or something? Maybe a trust fund he doesn't want to disclose at the moment?

elephantspoo · 12/12/2014 21:12

In reality, paying into a pension is one of the dumber things you could do with your money. You are in effect forgoing access to your wage today, in exchange for both risk to your capital and promise that you won't be taxed at some time in the future, by an known government, with no guarantee whatsoever.

In an economic downturn, pensions are not covered by any form of insurance. If you are invested in a fund that takes a 50% hit in the stock market! you lose 50% of your savings. If the pension provider goes bust, you lose everything.

In 2011 the government passed legislation that opens the door for nationalising private pension pots. In 2012 I think it was, Poland nationalised all it's citizens pensions. Effectively all pension money went into government coffers and citizens got government bonds (IOUs). America has done the same thing with all public employees. Their pensions effectively have been nationalised and they now all have a pretty sounding MyRA.

So, if you think it's a clever idea to give away the money you earn to someone else (Under UK law it is not your money. You have no legal claim to it. You are an unsecured creditor only), on the promise that they may return it to you 25 years in the future, and you believe that Britain will encounter no economic crisis in those 25 years, then go for it.

Someone will get rich, probably not you, but then it does save you all the time and effort having to manage your own savings and investments, and it does give you someone else to blame if end up with nothing but a pile of paper.

TalkinPeace · 12/12/2014 21:37

I do not plan to retire
so any pension will be merely an income buffer

I never had access to work pensions before kids
when kids were small I had no money
now things have changed, DH and I each have our own companies - we are putting in max amounts each year through the businesses
but treating them merely as 5 year savings plans

"Pensions" are less than 100 years old
they have had their day
they will be history within 20 years

elephantspoo · 12/12/2014 21:58

TalkinPeace - A lot of sense there. I don't see myself retiring either. Changing direction or pace maybe, but I'll work until I keel over and die. I can't stand to be idle, can't switch off my brain, and I love working too much. My pension pot is now in hard assets in a vault in Singapore. I don't trust the stock market to get past 2025 (I'd be surprised it it got past 2018 without a crash), and I don't trust the Government not to make a grab for all the idle wealth of its citizens.

PossumPoo · 13/12/2014 15:09

elephant why Singapore and what sort of assets?

DH and I have only just got serious about our pensions as we've travelled and worked in other countries, and possibly just been a bit feckless about. We plan to shift our pension to Australia in 5 years but i do worry about it a bit now.

elephantspoo · 13/12/2014 20:59

PossomPoo - I've moved my pension pot into physical gold, allocated bars, and vaulted it in Singapore using a SIP. It is just that little bit harder for our Govt. to get their hands on if they choose to 'nationalise' the country's private pension pots, and Singapore has fairly robust personal property laws I believe, if I need to defend it against forced repatriation. Nothing is solid or safe unless you physically own it and can touch it, but this is as close as I can get to securing the pension pot. The big mistake I made was paying into the pension fund in the first place, instead of saving and investing my own money.

TalkinPeace · 13/12/2014 21:02

elephants
Hmmm, I do not share your enthusiasm for gold, or for Singapore. But hey!

If I were to buy tangible assets for my SIPP, it would be woodland on which I would employ coppice and woodturning folk.

Want2bSupermum · 13/12/2014 21:15

Both DH and I do the minimum so we get the match. We are in the US so slightly different schemes are set up.

I agree with others that as you don't live together you can't say much. What I would do is use it as a springboard for talking about your future. I told DH before we were married that I saw us having a future but financial security was very important to me. When he said he couldn't afford to save I challenged him to put 1% of his salary away. It was better than nothing and showed that he could save something. After a couple of months I asked him about increasing it to 2% and we went from there. IMO it's important to always be saving.

Agree with talking on pensions. As we live abroad our pensions are invested in a mix of us and emerging market investments. We have then bought a home where we can rent out half in our retirement. We expect to buy another apartment building in the same town in the next 5 years or so. Instead of putting cash into a pension plan we will pay off the mortgages.

Want2bSupermum · 13/12/2014 21:18

We also have DH's business too which generates a nice income. Told DH to build up independent board positions too as his experiences would be valuable to others. It would give us a fantastic income during our retirement.

elephantspoo · 13/12/2014 23:24

TalkinPeace - Another eminently sensible idea. I was looking to park the money somewhere safe. I don't contribute to the pension plan at all now, and the original provider wouldn't allow me to park my money on the sidelines or hold in in cash in their account. They only allowed me to keep it in any one of a number of funds. I wanted a safe asset that would retain buying power and out perform inflation. Not an investment vehicle. So it made a lot of sense. I will in all likelihood liquidate at some point in the future (8-10years depending on the relative values of land vs. gold) and move into something like land or commercial property. But for the time being I was looking for safety rather than return. I'm playing the long game here as I can touch it for a long while yet. Just getting it out of the paper markets before something bad happens. Better a year or two early than a minute or two late.

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