Reply to: Budget 2014: 'Pensioners should be free to buy Lamborghini,' says minister

[Doggy Styles]

Not a good one. You don't have time to read a lot of it.

[DaveB]

[Smartie]

True.

With average life expectancy rising significantly over the years, each person's pension fund has to be spread over a longer period than it used to.

It has done until recently, however in the UK life expectancy fell over the last couple of years. Maybe it's a 'blip' or maybe obesity, cuts and poor care for the elderly contribute.
Either way, the life companies can't rely on increasing life expectancy as an excuse at the moment and neither can the government, though with their increases to the pension age they're really just playing catch-up.

[Doggy Styles]

indeed I think they would be better off making annuities perform to a decent standard.

True.

But when you do the maths they couldn't be much better.

With average life expectancy rising significantly over the years, each person's pension fund has to be spread over a longer period than it used to.

And with low interest rates and low economic growth, fund growth has taken a hit as well.

So although I can see the attraction in trying to do better, where can people do better? The same issues apply to most other investments, unless you get lucky with a risky punt on the stock market. At least annuity income is (mostly) guaranteed and low risk.

[VectraMan]

You have it backwards - if you only take up smoking in retirement your annuity will assume you are going to live a long time and pay badly. You need to get unhealthy before you buy the annuity, then clean up your act.

Or find a way to fake bad health just as you're retire.

[Peoplesoft bloke]

You have it backwards - if you only take up smoking in retirement your annuity will assume you are going to live a long time and pay badly. You need to get unhealthy before you buy the annuity, then clean up your act.

Bugger!

[d000hg]

Indeed, I plan to start smoking and drinking to excess in my retirement.

You have it backwards - if you only take up smoking in retirement your annuity will assume you are going to live a long time and pay badly. You need to get unhealthy before you buy the annuity, then clean up your act.

[Peoplesoft bloke]

The people who issue annuities know people die, so it will only mean they can tailor it. If you've poor health you might get a better deal

Indeed, I plan to start smoking and drinking to excess in my retirement.

[Sysman]

Suggstions required

Would brainless people save up enough in their pension pot though? If they do it's still their own money - given that probability of death is increasing considerably with age I say it's totally fair that they get the right to use their own money as they see fit, for example take the cash and fook off to live in some nice sunny country with much lower cost of living.

OK, suggestions required for a nice sunny country with a much lower cost of living, please.

[d000hg]

They know what illnesses you have and with research can find out your families history

As our medical records have been given out now illicitly won't annuities be a poor deal anyway.

The people who issue annuities know people die, so it will only mean they can tailor it. If you've poor health you might get a better deal

[GreyWolf]

Your pension money? Oh no, it's that fat **** Tom Watson's money:

“People will tell you that ‘it’s your money, you should decide how to spend it’. The whole point is that it just isn’t that simple. Yes, you paid in. But so did the taxpayer. And the government has every right, therefore, to ask that you spend it in the manner it was intended when we were stumping up the cash.”
T. Watson, between filling his fat, tax-payer funded face.

It's great that Labour have moved on from thinking money comes from the magic money tree and that there are these things called taxpayers but it'd be nice if they could take that next step and discover who exactly the taxpayer is. It surely isn't the "we" he was referring to.

It would also be quite nice if they knew what tax relief is but I suppose we can't expect too much from them. Too far, too fast and all that.

[AtW]

I'm talking about brainless people, and there are a lot of them.

Would brainless people save up enough in their pension pot though? If they do it's still their own money - given that probability of death is increasing considerably with age I say it's totally fair that they get the right to use their own money as they see fit, for example take the cash and fook off to live in some nice sunny country with much lower cost of living.

[Doggy Styles]

Are you saying that prudent adult people who saved up money during their life should not be trusted with spending their own money?

I'm talking about brainless people, and there are a lot of them.

The idea of the tax relief they received when paying premiums was to encourage them to support themselves in old age until they die.

And the answer is no, the brainless cannot be trusted. The evidence of fiscal ignorance is all around us.

[AtW]

Isn't the greater point to all this that it stops the supercar manufacturers from all going bust if people suddenly start living to 120?

FTFY

[VectraMan]

Isn't the greater point to all this that it stops the annuity providers from all going bust if people suddenly start living to 120?