Auto enrollment pensions

littlefeet

Surprised there hasn't been a thread on this already. It is coming in January. Where I worked had a compulsory pension no escaping it, you could add to it if you wanted, needless to say in my 30s I moaned about having to pay it retirement seem a million years away, so it's a great idea, one of my family members thinks it's scam to get rid of the government paying the pension.

arctictree

The weird thing is that for decades we have been advised to invest in our own pension and that the state pension will no longer exist. But every budget, they increase the state pension. I cant see any Irish government ever removing the state pension. Political suicide.

Wanderer78

https://www.boards.ie/discussion/comment/123850318#Comment_123850318

probably not gonna be possible to absolutely pull the plug on state pensions, for various reasons, but i still think this should have been implemented years ago, it might even help to increase wages for some

Buddy Bubs

If people under 67 can get money from the government for doing nothing then you can be very sure people over 67 will be able to get it too. Its just another form of social welfare.

State pension is going nowhere. However if you're earning 800 or 1000 a week or whatever coming up to retirement and couldnt manage to put a few quid away you are going to struggle big time on the pension 280 or whatever it is.

Wanderer78

https://www.boards.ie/discussion/comment/123850358#Comment_123850358

the rate of inflation of property prices is gonna turn the whole pension debate upside down and inside out, state pensions are truly going no where

Buddy Bubs

https://www.boards.ie/discussion/comment/123850376#Comment_123850376

I dont even know why it is ever mentioned as a possibility.

Nobody over 40 would ever vote anyone in that proposed that, a few youngsters might not care .

martingriff

https://www.boards.ie/discussion/comment/123850358#Comment_123850358

The difference there of course you worked for your life and are now retired not like some of the people under 67

martingriff

Of course you have employer's giving out

Mrs OBumble

https://www.boards.ie/discussion/comment/123850387#Comment_123850387

Or you didn't work, and still get almost as much per week anyway!

Oldness Benefit should be abolished. Along with age limits on jobseeker, sickness and invalid benefits.

plodder

https://www.boards.ie/discussion/comment/123850521#Comment_123850521

It's such a joke. They have all these complicated rules around qualifying for the contributory old age pension. But, if you sat around scratching your arse for 40 years, you still get almost the same anyway 😀

plodder

https://www.boards.ie/discussion/2058425436/auto-enrollment-pensions

It is a great idea. The money you put into a pension in your twenties or thirties (especially if your employer is adding to it) can accumulate into quite a lot by your sixties. It has a much bigger effect than deciding to throw money at it in your fifties imo. That said, I agree the state pension is going nowhere. It is a pittance compared to public sector occupational (defined benefit) pensions which are paid for out of all our taxes, but people even with private pensions will still rely on it.

mickdw

I imagine the state pension will exist but how many people starting into this new auto enroll fund will end up paying to end up with a pension that just about equals what they would have got on the existing pension but the rules will likely change to mean that even contributory pension from current prsi contributions will be muddled in together with end result of same basic pension after paying prsi and pension.

plodder

https://www.boards.ie/discussion/comment/123850982#Comment_123850982

I'm not sure what you are saying but if it's that these auto-enrolled pensions will be some kind of replacement for the state pension, then that will definitely not be the case. Auto-enrolled private pensions together with the state pension will more than likely come nowhere near the public sector pensions that we all have to pay for in our taxes.

littlefeet

People have to be encouraged, nobody either the employer or employees including agency workers, should be able to leave the MFF unless they have another pension set up, my family member was slightly joking conspiracy theory about it being a replacement for the state pension. A means tested state pension is very different from non means tested one, state employees contribution to their pension it's not free.

keeponhurling

State pension is pretty low. Totally makes sense to save for that bit extra and a more comfortable retirement.

This law comes too late for many people who haven't been saving for retirement, but better late than never.

littlefeet

People have funny ideas about pension in Ireland, they seem to thing it's largely a state employees thing. for example a large fast food company in Ireland has employee pensions, lots of employees working in the equivalent of low skill work have company pensions because they work for large companies.

littlefeet

I had two pension that I added together moral of the story, always keep your paper work.

littlefeet

No, because you can put more than the minimum in to the MFF it's your choice to put more in to your own pension, you can't do that with the state pension.

Podge_irl

https://www.boards.ie/discussion/comment/123850318#Comment_123850318

Yes it is political suicide and so they will keep it until the system collapses in on itself, which is more or less inevitable.

StormForce13

https://www.boards.ie/discussion/comment/123851765#Comment_123851765

Surely you're not suggesting that the Harvard Economics graduate and current leader of the Opposition Mary-Lou McEinstein was misleading the voters when she boldly stated that "the demographics will look after themselves" when asked about her promise to lower the State pension age to 65 when elected Taoiseach.

Jim2007

https://www.boards.ie/discussion/comment/123850318#Comment_123850318

Nobody is suggesting that the state pension will be abolished in any one of the 27 members! They are trying to address the reality of their simply being no money available to fund pensions beyond their current levels. Ireland and Germany have propbably bought a little extra time because of the influx on young immigrants but the clock is ticking. Long term state pensions are expect to be capable of finance about 20% of the costs of retirement.

It's already happened here in Switzerland! My state pension covers about three months expenses, after that you are on your own. The former East Germany is becoming a popular retirement destination for the Swiss people from the Germanic part of Switzerland. And there are daily adds about moving to retirement homes in Thailand…. People need to start preparing for what is coming down the line, otherwise they may be in for an unpleant surprise espically in an expensive country like Ireland.

Mrs OBumble

https://www.boards.ie/discussion/comment/123851809#Comment_123851809

No: She is well aware of the contribution that assisted dying will make to resolving the pension deficit.

valoren

Ann was born in Newry and Barry was born nearby in Dundalk on the same day. Their relatives gave cash gifts to their parents. Each baby received 2,000 euro. Their parents decide to put away the money until they are older. Anns parents open up a Junior Stocks and Shares ISA and put the money in a basic index tracker which has a historic average return of 10%. Barrys parents open a Credit Union account and Barry gets an average "dividend" of 1.3% a year. The accounts are untouched. In the decades since they were born there were the usual market crashes, booms and average years. When Barry is 65 he will get 4,571 euro. Ann will get 891,583 euro. Long story short, maybe it would be an idea to set up an Irish equivalent of the ISA accounts the UK have and which are very successful.

arctictree

https://www.boards.ie/discussion/comment/123851873#Comment_123851873

"They are trying to address the reality of their simply being no money available to fund pensions beyond their current levels."

Watch them increase it in the budget!

Dublin Calling

https://www.boards.ie/discussion/comment/123852040#Comment_123852040

Bertie, Is dat you?

littlefeet

One of my sisters says joking, that's when she retires and rocks up for her state pension they are going to say ..sorry all the money is gone!

Dublin Calling

https://www.boards.ie/discussion/comment/123852178#Comment_123852178

This is how pension schemes work. The existing pensioners are protected, as the cost to those yet to retire. The Waterford Crystal employees got shafted when their scheme got into trouble.

Patrick2010

https://www.boards.ie/discussion/comment/123851933#Comment_123851933

How does 2000 grow to only 4500 after 65 years?

blackwhite

https://www.boards.ie/discussion/comment/123852422#Comment_123852422

I suspect a typo above.

An average "dividend" of 1.3% (not the 0.13% quoted) would result in €4,631 after 65 years.

Upfront	2,000	2,000	2,000	2,000	2,000	2,000	2,000	2,000	2,000	2,000
Ave annual return	1.0 %	2.0 %	3.0 %	4.0 %	5.0 %	6.0 %	7.0 %	8.0 %	9.0 %	10.0 %
After 65 yrs (compounding)	3,819	7,245	13,660	25,597	47,680	88,290	162,546	297,560	541,692	980,741

valoren

https://www.boards.ie/discussion/comment/123852510#Comment_123852510

Yes, a typo. Should be 1.3%. Amended.

Dogsdodogsstuff

https://www.boards.ie/discussion/comment/123852040#Comment_123852040

The presumption people make is Ireland will always be doing aswell as we are doing now. Lots of dysfunction and changing culture in global politics could hit us hard.

I could see drastic changes to the pension landscape under duress in future decades. But , that aside, by the time pension pots in Auto enrolment are decent (maybe 20 years), the state can stop increasing the state pension and/or amend rules for being entitled to it.

Anybody relying on the state pension in retirement is very silly and asking for trouble.