Another beef of mine - the two tier pension. I am on the "old" rate and my husband on the "new" one. The difference is around £3k a year and the gap widens every time there is a % increase.
------------- Freedom is a light caravan and an open road.
Quote: Originally posted by JoannaLesley on 04/12/2024
Another beef of mine - the two tier pension. I am on the "old" rate and my husband on the "new" one. The difference is around £3k a year and the gap widens every time there is a % increase.
I couldn't agree more! My wife and I are both on the old rate, and it is well below the so-called living wage, which is suppose to be the minimum anyone can be expected to live on. How is that justifiable? Why does the two-tier pension even exist?
Were you at any time during your working career benefitting from contracting our provisions as a result of the private sector pension contributions you were making?
If so you paid lower NI contributions whilst working.
We are both on the contracted out rate but have work pensions too. As they take your state pension off the taxfree allowance, we pay tax on them! They get you if they can
------------- DS-There's more to life than football!!!
So much for the triple lock! Unless the personal allowance is increased, I reckon we will soon be paying even more in tax. We both have company pensions as most folk probably have.
OH is the same as you madasaman, he was supposed to get the new pension then at the very last minute he ended up with the old.
I got the old too, and I am a WASPI woman, so had to work an extra 3 years, plus paying the extra NI for that time, plus the years that I paid NI top up for to get the full years which I didn't need.
We both have occupational pensions too. I gave OH some of my tax allowance, but this year has pushed me above the threshold so now I pay tax too.
I did get the New Pension, but have paid in far more NI contributions than I'm 'getting out' as it were!
... and Triple Lock or otherwise, I never seen to benefit much from any payment rises, as the buggers just take it back in increased income tax on my occupational pension!
I strongly feel I've more than paid my way in this world with nearly 50 years of employment related taxes, so my pension WHICH I FUNDED should now be tax exempt! It's NOT a Government benefit handout, I PAID FOR IT!!!!!
We are both on the old State Pension but we were also contracted into SERPs which nearly doubles our pensions. Fortunately we also have occupational pensions as well. Whilst they do go up it is by a much smaller amount and much of that modest increase is lost to tax because of the frozen allowances. I find it difficult to buy into this narrative that pensioners are worse off because with the triple lock both of our state pension have gone up over £100 a month for the last two years, given that its paid 13 time a year that is +£1300 a year each, way and above what we have lost from not having the winter fuel allowance. We can't be alone in having that sort of increase?
Quote: Originally posted by saxo1 on 04/12/2024
You weren't paying for your pension, you were paying for the preceding generations pensions as todays taxpayers are paying for your pension today.
Yep. It was only a year or so ago that pensions etc went up 10% due to higher inflation. The same year public sector pay rises were about 5% so they were being paid less money in real terms whilst paying towards a 10% pension increase
A friend of mine born 5 months before me got her State Pension at age 60. I got mine age 66. Multiply that difference in income if you will. But equalisation between men & women had to happen, just that my goalposts moved twice.
I got the state pension at 65, my wife 66. I have had an RAF pension since 1996 after 24 years service. Very nice but in my second career in FE paid plenty of tax! Such is life.
------------- DS-There's more to life than football!!!
The triple-lock is a con. It is based on inflation, not on the real cost of living increase. They are not the same at all if you are on a low income. When inflation was running at 10%, the REAL rise in the cost of living for someone on a low income (such as a basic state pension) was closer to 25%. Gas and electricity alone went up by around 60%.
One of the problems with basing things on percentages is that a small % increase on a large sum can work out to be far more actual money than a large % increase on a small sum. They don't come much smaller than a basic state pension, so consequently a large % increase in the basic state pension is not very much at all in actual cash terms.
Not sure there is any other way of expressing it other than in percentage terms. Don't forget what we get as a State pension often relies on how we managed our contributions in the past. Some people opted out of SERP's in order to get a better occupational pension. If someone did that I don't think once they retire they can complain about the state pension being smaller. I was monitoring my pension for the best part of 30 years and I don't think I can complain about what I get from the state. Had I not retired at 58 my occupational pension would have been a bit bigger (and taxed more!) You have to look at much your state pension has increased in real money in the last two years and for many people that will be quite a lot.
Quote: Originally posted by David Klyne on 05/12/2024
Colin
Not sure there is any other way of expressing it other than in percentage terms. Don't forget what we get as a State pension often relies on how we managed our contributions in the past. Some people opted out of SERP's in order to get a better occupational pension. If someone did that I don't think once they retire they can complain about the state pension being smaller. I was monitoring my pension for the best part of 30 years and I don't think I can complain about what I get from the state. Had I not retired at 58 my occupational pension would have been a bit bigger (and taxed more!) You have to look at much your state pension has increased in real money in the last two years and for many people that will be quite a lot.
David
My state pension has "increased" but not in real terms. It will only buy about 80% of what it would buy when I retired 10 years ago.
My point about percentages is that a large percentage of a small amount is a very small amount, whereas a small percentage of a large amount is a large amount. 10% of £13,000 a year is £1,300, but 5% of £30,000 a year is £1,500. Talking in percentages can be very misleading. What sounds like a large amount can actually be very small.
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