Also, 2 in 5 struggling to make ends meet
this post was submitted on 23 Jul 2024
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Which may result in them opting out of paying into a private pension.
Any reccos for one? I signed up for Vanguard but they required a UK number, and I don't live there (but I am British).
I don't expect to reach retirement age as it will keep increasing. If I do make it that far, I expect having to work so long to get there that I will be pretty much a husk of a human.
That isn't to say I'm not paying into one, but I probably am in the 'not adequately saving' group because I want to enjoy the time I have now as best I can.
The future is terrifying and causes a lot of anxiety...
Edit: also wasn't the state pension supposed to cover a basic retirement!? Fuck.
I believe you could scrape by on a state pension if you have your accomodation paid for, but it'd be absolutely no frills and if your rent is £1000pcm, you're absolutely fucked.
Yep, two years of arthritis and then death, what a brilliant retirement it will be!
If I do make it that far, I expect having to work so long to get there that I will be pretty much a husk of a human.
You can get your pension much earlier if you do a private one.
Assuming that it pays enough to justify an early retirement.
That is dependent on your contributions.
Which the article implies many are struggling to afford.
Right, but you're talking about yourself I assume.
I was generalising. I think it's pretty obvious that you can save for an early retirement if you're lucky enough to have the means to do so.
This shouldn't come as any surprise as many people can't afford basic day to day living costs because of low wages and reduced employee security.
The fuck is a "pension"
If you're British and employed your employer is legally required to provide a private pension I believe. You also get a state pension if you've been paying national insurance (most people will get this taken out of pay cheques before you ever see the money, same as income tax). Some employers offer "matching contributions" up to a certain amount. For example if you decide you want to send £100 per month into your private pension, your employer will also do the same, so your pension gets £200. These contributions are tax free so it's a tax-efficient way to save money when compared to privately investing where you'd have to invest from your income, which has already been taxed and then potentially have to pay capital gains tax on profits.
Over 1 million people are on zero hour contracts (1 in 33 UK working age people), which does not mandate employers to auto-enroll. Another 4 million are self-employed, and the majority of them are not saving towards retirement.
That means a potential of 3 million of working age zero and self-employed have nothing saved, a further 2 million from that same pool will likely have less than recommended amount saved.
In the company employed pool, 9% have opted out of the enrollment, so that's 2.5 million opted out.
In total, about 20% of working age people are not actively saving into pensions (although may save elsewhere). A potential bombshell if that many people become officially destitute in a relatively short space of time.
While the UK has made some steps to try and rectify things (as chancellor, Gordon Brown funded the 2-year commission that recommended auto-enrollment and it has worked well), 14 years of Conservative rule have let some very nasty employment practices seep in and poison over a decade of pension funding opportunity. Companies are underpaying employees, Government is overtaxing employees. Only companies coming out on top and seeing record profits while the country wastes away.
Fingers crossed, intervening on this is high on Kier's priorities because our current unfettered capitalist model is a complete mess.
Yes I should have said "employed full-time" probably. This also doesn't account for the self-employed who have to manage it themselves too rather than having their employer do it.
The matching is usually done with a maximum percentage of your salary.
Some employers might offer 3%, for example.
So if at that company you earn £24,000, pay 10% into your pension each month (£200), the company contributes £60, and you don't pay income tax on the money that went to the pension (probably £40 savings).
Which means that if you decide to just take the money instead, you'd only see £160 instead of £260 in your pension.
I think it's a guest house or something 🤔
Is this some European thing I'm too American to understand?
I think it is equivalent to your 401k. Could be wrong though.
An investment savings fund built up over ones working life to provide an income in retirement.
My lifestyle is my retirement plan.
Beats getting killed in water wars or starvation.
My wife is older than me. Only other people I have are my parents. When they are gone I will also go. Pure helium.