Pensions

[PerkyOchrePeer]

I am not sure what to think about means testing people's pensions according to their incoming and outgoings

Means testing only looks at money a person has coming in, not going out.

If somebody only has a state pension then that's the only money they have coming in

Say for example you don't work in a job that provides a work pension so you only have your state pension to rely on when it retire

Not everybody takes out a private pension

Means testing would also look at savings. So someone could only have state pension only but 200k inheritance.

It is compulsory now ( and has been for a few years ) for employers to make pension contributions for their employees. Obviously some people will be agency/ temporary/ zero hours and not have this benefit from their employer.

Unless they fall within one of the very limited exemptions (or are self employed), they will have been automatically enrolled into a pension scheme and will only not have any additional pension if they have chosen to opt out. Why should someone who has not bothered to save be "rewarded" with a full state pension whereas the saver gets theirs eroded by means-testing? That's the flaw with what you seem to be advocating.

My Mum worked as a dressmaker and she relied on clients to give her work. Because of that she only had her state pension

OK. So?

But these days someone self-employed could take out a personal pension.

The pensions landscape has completely changed over the last 25 years.

I don’t agree with means testing the State pension, at least not at the moment. May be different if they said that nobody under 18 would ever qualify (and let them pay lower NI to compensate). Then they could plan accordingly.

Employees are automatically enrolled in a work pension now for this very reason. They're very basic, the compulsory ones. Like Nest.

I think they should have left the pension at 60 for women and 65 for men

Completely unaffordable with the increase in life expectancy, and perfectly fair for men and women to retire at the same age,

But if you want to retire at 60, there’s nothing to stop you - you just have to save enough to do it.

Because on average women live longer than men, there’s an argument to be made that women should receive state pension later than men so that on average the amount of pension paid is equal.
I’m definitely not advocating that, but I don’t agree that women should retire 5 years earlier. I don’t think sex should be a defining factor. Age of retirement may as well be calculated based on class or postcode or chronic illness as these also impact longevity. But it all becomes so complicated and creates perverse incentives that a universal payment is inevitable albeit with rising ages.

What's the cost of administering a means tested system?

How on earth do you justify that statement?

Women take on so much more than men over a long period of time which is mentally and physically exhausting. Giving birth, raising children, general housekeeping has historically been left to the woman ie. shopping, cleaning, arranging childcare, life admin, as well as holding down a job.

As we age the menopause and then when elderly relatives need care it generally falls to women to take on these responsibilities, taking to appointments, making sure they have all their shopping, housekeeping etc. women have traditionally taken on so much more than men we are knackered!

If anyone thinks the statutory level of auto enrollment (think it's a combined 8%) will be enough to provide for any sort of standard of living without the state pension then they're in for a big shock.

Unless you're earning £100k plus that level of contribution will earn you peanuts in retirement.

I'm lucky in that place offers significantly above that when employees match contributions, but currently job hunting and I'm amazed at the number of employers offering 4/5%. I'd have to ramp up my contributions significantly to get to what I think is a decent month contribution

Why

It’s already partly means tested in that you have to work a certain amount of years to get a full state pension. I am 63 so the decision to raise the state pension age for women and men has made a substantial impact on my retirement, where I worked it only had 3 PAYE employees, I didn’t get enrolled into a company pension scheme until I was 57.

But if we want equal pay with men then that also means equal pension ages. I agree with all you say but it has nothing to do with government policy on state pensions

I can think of a lot of men in hard physical jobs who would disagree with your sweeping statement. My father included.

I used to date a builder amd thats a hard job