Guest sibon Posted January 19, 2012 Share Posted January 19, 2012 I don't begrudge anyone as an individual but collectively it just can't carry on. Let's say that a teacher pays 6% of their salary in over a lifetime, with an average of £25k over 30 years. That's a total total career personal contribution of £45k. If they retire at 55 with a final salary of £38k just where is the money going to come from for an index linked two-thirds final salary pension the next 30 years? Their contribution has gone in less than two years! If a teacher earns a final salary of £38k and retires at 55, they will receive 30/80 x 38k = £14.25K in pension, under the current rules. This figure will be actuarially reduced to reflect the very early retirement. The pension paid would be below £12K. The new rules will reduce these figures. £38k is on the high side for a teacher's final salary. Link to comment Share on other sites More sharing options...
truman Posted January 19, 2012 Share Posted January 19, 2012 If a teacher earns a final salary of £38k and retires at 55, they will receive 30/80 x 38k = £14.25K in pension, under the current rules. This figure will be actuarially reduced to reflect the very early retirement. The pension paid would be below £12K. The new rules will reduce these figures. £38k is on the high side for a teacher's final salary. How much will they have contributed? Link to comment Share on other sites More sharing options...
quisquose Posted January 19, 2012 Share Posted January 19, 2012 If a teacher earns a final salary of £38k and retires at 55, they will receive 30/80 x 38k = £14.25K in pension, under the current rules. This figure will be actuarially reduced to reflect the very early retirement. The pension paid would be below £12K. The new rules will reduce these figures. £38k is on the high side for a teacher's final salary. Assuming a pension of £14.25k and a retirement at age 65 still requires an annuity of £340k. The average private sector employee has no chance of accruing anything near to this over his working life, and it seems unfair that his taxes (or more realistically his children's taxes) should subsidise public sector pensions imho. Link to comment Share on other sites More sharing options...
junction1 Posted January 19, 2012 Author Share Posted January 19, 2012 How much will they have contributed? The general rule of thumb is two thirds of their tax-free lump sum (not finite but pretty accurate), and do bear in mind that they receive tax relief of up to 40% of their own pension contributions. What the public sector is asking of the private sector is for it to continue to fund their pensions at the expense of their own. And from what I contantly hear and read is that they want us to be happy about it. Link to comment Share on other sites More sharing options...
Pegasus Posted January 20, 2012 Share Posted January 20, 2012 If you're a teacher then you wouldn't start working until finishing your degree at 21 so retiring at 55 would give you a recognable service of 34 years. If you worked the same amount of years (34) retiring at 66 you would recieve a risidual pension of 12,978 but this is significantly reduced if you retire early. Here's a link to the calculator: http://www.teacherspensions.co.uk/resources/calculators.htm Link to comment Share on other sites More sharing options...
Pegasus Posted January 20, 2012 Share Posted January 20, 2012 What the public sector is asking of the private sector is for it to continue to fund their pensions at the expense of their own. And from what I contantly hear and read is that they want us to be happy about it. This is totally wrong, since the government introduced public sector pensions they have helped themselves to well over 45 billion pounds out of the fund which had been put in by its members. If they had not done this then more funds would be available now. The pension fund in made up of employers and employees contributions the fund is massive and is self sustaining it shouldn't cost the tax payer anything. What everyone should be asking is how has it been missmanaged by sucessive governments? What everyone should be saying is: why am I paying more and having to work longer for my state pension? A good friend of mine died last week, he had worked in the steel industry all of his life he was 63...the majority of working people don't live to a grand old age as offered by the media. Link to comment Share on other sites More sharing options...
truman Posted January 20, 2012 Share Posted January 20, 2012 If you're a teacher then you wouldn't start working until finishing your degree at 21 so retiring at 55 would give you a recognable service of 34 years. If you worked the same amount of years (34) retiring at 66 you would recieve a risidual pension of 12,978 but this is significantly reduced if you retire early. Here's a link to the calculator: http://www.teacherspensions.co.uk/resources/calculators.htm You'd get a lovely tax free lump sum as well... Link to comment Share on other sites More sharing options...
retrogo Posted January 20, 2012 Share Posted January 20, 2012 ... and to add insult to injury, the public sector is now better paid than the private sector! ... then compounded still further by the fact that the private sector pays for it all! Yeps, You want someone to be police officers, medical staff, firefighters, dwp, social serivice, teachers etc. They aint going to do it for nothing and everyone in the country benefits from these services at some point in there lives. Link to comment Share on other sites More sharing options...
I1L2T3 Posted January 20, 2012 Share Posted January 20, 2012 Assuming a pension of £14.25k and a retirement at age 65 still requires an annuity of £340k. The average private sector employee has no chance of accruing anything near to this over his working life, and it seems unfair that his taxes (or more realistically his children's taxes) should subsidise public sector pensions imho. But private sector pensions used to deliver this. Why not any more? Sure there is a demographic element to but why aren't the pension funds being taken to task over extortionate fees, chronic fund mismanagement, appalling investment decisions etc... Why aren't employers being taken to task over pension fund abuse, neglect and mismanagement? By deflecting attention onto public sector pensions you are doing the dirty work for the private funds and employers who have shafted the private pension funds. Link to comment Share on other sites More sharing options...
DUFFEMS Posted January 20, 2012 Share Posted January 20, 2012 Assuming a pension of £14.25k and a retirement at age 65 still requires an annuity of £340k. The average private sector employee has no chance of accruing anything near to this over his working life, and it seems unfair that his taxes (or more realistically his children's taxes) should subsidise public sector pensions imho. Totally agree. My private pension, when I retire next year will be worth 2 bob and a conker! Link to comment Share on other sites More sharing options...
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