Whats your private pension fund worth?

FURET

cbyrd wrote: »

Also with my ex husband'a pension, started in his 20's, he had almost E34,000 wiped off it in the crash.. it'd be worth more had we stuffed the money under the mattress.

I highly doubt that unless he was invested in some total bs. That crash was a godsend to anyone building a retirement pot. The US stock market for example has grown 230% since the low point of that crash.

People are terrified of stock market crashes when the reality is that they should be welcomed by anyone who isn't retired.

To the fellow who said he monitors the economy and moves to safe havens during troubled times -- that's one of the worst strategies imaginable.

ytpe2r5bxkn0c1

FURET wrote: »

People are terrified of stock market crashes when the reality is that they should be welcomed by anyone who isn't retired.

What retired person, with more than 2 brain cells, would have any portion of their pension fund in stocks? Nobody.

Approaching retirement age you move to cash and low risk options.

worded

Didn't the financial ratings like standard and poors people give AAA ratings to dodgey groups for 20 mortgages so pension funds could invest in these?

Lots of pension funds are in the negative

It's a big scam in a lot of cases, the brokers are the only winners

ytpe2r5bxkn0c1

worded wrote: »

Didn't the financial ratings like standard and poors people give AAA ratings to dodgey groups for 20 mortgages so pension funds could invest in these?

Lots of pension funds are in the negative

It's a big scam in a lot of cases, the brokers are the only winners

There are many thousands of people on good private pensions, having retired in their 50s, who wouldn't agree with you there. And remember that many negatives are actuarial evaluations based on the funds closing entirely. In practice the most funds are sound.

FURET

Rory Victorious Sandalwood wrote: »

What retired person, with more than 2 brain cells, would have any portion of their pension fund in stocks? Nobody.

Approaching retirement age you move to cash and low risk options.

I did say anyone who isn't retired.

When in my 60s and beyond I plan to keep 35-40% of my portfolio in stocks, the rest in bonds.

Winterlong

billyhead wrote: »

Are you saying the like sof an AVC plan managed by a financial institution is not advisable?

No, what I am saying is that people should make a bit of effort to understand how pensions work, what the options are, and go for one that they are comfortable with.
This is a million times better than 'I dont trust banks so will not have a pension'.

Johngoose

ChikiChiki wrote: »

I'm 29 and have about 35k in the fund. I stopped contributing a few months back on leaving a job but must start again early next year. Unemployed at the minute and I'd love to get at it as I've literally €12.83 to my name after counting this morning. :-)

Fair play hang on in there.Ive had hairy moments myself in my life, but thankfully back on track.You will get through this.

ytpe2r5bxkn0c1

FURET wrote: »

I did say anyone who isn't retired.

When in my 60s and beyond I plan to keep 35-40% of my portfolio in stocks, the rest in bonds.

Thus you said that anybody retired should not welcome stock market crashes; but they aren't, or should not be, affected by them.

35% in stocks when over 60 years of age is madness in my opinion.

Eamondomc

Rory Victorious Sandalwood wrote: »

Thus you said that anybody retired should not welcome stock market crashes; but they aren't, or should not be, affected by them.

35% in stocks when over 60 years of age is madness in my opinion.

I ve just gotten my annual pension statement from Irish life.
40 k
I haven't contributing to it for 3 years now.
The statement said, "cash in value" 40k

Why would they word it like that?

mahoganygas

Eamondomc wrote:

Why would they word it like that?

That's it's value IF you were to retire today. But it's currently tied up in investments which are valued at 40k.
When you retire their value could be different.

There isn't 40k cash sitting in your pension fund.

Giacomo McGubbin

Rory Victorious Sandalwood wrote: »

What retired person, with more than 2 brain cells, would have any portion of their pension fund in stocks? Nobody.

The thousands of Irish old people who were told Irish bank shares were sound.

FURET

Rory Victorious Sandalwood wrote: »

Thus you said that anybody retired should not welcome stock market crashes; but they aren't, or should not be, affected by them.

35% in stocks when over 60 years of age is madness in my opinion.

You should never be without at least 20% in stocks at any time according to Benjamin Graham.

Many people aged 60 can expect to be in retirement for 30 years. That's a very long time to be out of the stock market. If one is entirely in bonds and cash at age 60, one risks running out of money before death, as bonds and cash aren't as effective as stocks in out-performing the rate of inflation. It's madness to have zero stock market exposure when retired in my opinion, even if it's just 20%. This isn't only my opinion by the way; it's the wisdom of legendary investors such as William Bernstein, Jack Bogle and the aforementioned B. Graham, all of whom advocate(d) for the average person.

cloloco

I started my pension with employer at 19, at the time I was thinking what do I need to pay this for. Nowadays boy am I glad to have it, not sure on value as its a defined benefit scheme but will pay me 2/3 of my salary every year once I retire with an option to commute some of this for a lump sum.

It includes death in service and a spouse/dependant pension should the worst happen.

New entrants to the company are on a different scheme (defined contribution) now that doesnt have all the benefits.

Am thinking of starting AVCs soon so I can hopefully afford to retire a bit earlier.

caff

cloloco wrote: »

I started my pension with employer at 19, at the time I was thinking what do I need to pay this for. Nowadays boy am I glad to have it, not sure on value as its a defined benefit scheme but will pay me 2/3 of my salary every year once I retire with an option to commute some of this for a lump sum.

It includes death in service and a spouse/dependant pension should the worst happen.

New entrants to the company are on a different scheme (defined contribution) now that doesnt have all the benefits.

Am thinking of starting AVCs soon so I can hopefully afford to retire a bit earlier.

Good chance the company will do their best to close the scheme to further accrual and move everyone on to DC. Getting out of DB is all the rage now with company accountants due to accounting rules forcing them to show pension liabilities on balance sheets.

cloloco

caff wrote: »

cloloco wrote: »

I started my pension with employer at 19, at the time I was thinking what do I need to pay this for. Nowadays boy am I glad to have it, not sure on value as its a defined benefit scheme but will pay me 2/3 of my salary every year once I retire with an option to commute some of this for a lump sum.

It includes death in service and a spouse/dependant pension should the worst happen.

New entrants to the company are on a different scheme (defined contribution) now that doesnt have all the benefits.

Am thinking of starting AVCs soon so I can hopefully afford to retire a bit earlier.

Good chance the company will do their best to close the scheme to further accrual and move everyone on to DC. Getting out of DB is all the rage now with company accountants due to accounting rules forcing them to show pension liabilities on balance sheets.

Yes, you are right and its already happened in my company. So any increase in salary from here on in will be pensionable on the new DC scheme.

twinytwo

Moo Moo Land wrote: »

My wife will be getting a public sector pension. She has a relatively low grade position in the Dept of Education.
I found out last year that I would need to be contributing 1000 euro a month to my pension in order to match her
pension value at retirement. I am praying she doesn't divorce me!
Given the demographics I am not sure how the government will afford these public sector pensions while keeping the state
pension at a suitable value.

Its simple.. they wont.

The state pension will be gotten rid of in the next decade and then most of the public pensions will go as well.

If people actually took their head out of the sand they would realise its all gonna come crashing down. 5 million people cannot possibley support the massive public pension bill.... its a simple fact.

Private pensions will be raided by the government as required. They hum and haw about people having private pensions but you see nothing being done to prevent them being raided.

FURET

seamus wrote: »

Yeah, a lot of pension funds were pushing older people to move all or part of their pension into stocks and property on the basis that it was performing really well and would give them a huge return into their retirement. When the economy collapsed, their pensions dropped in value, which is a disaster for anyone who's within a decade of retirement.

There's a reason why older people are advised to put their pension funds into stable/safe funds - so even if the funds aren't performing well, they at least aren't dropping in real value and will still have their pension when they retire.

It is against best practice to move entirely out of stocks. When I hear of pension funds 'pushing people', it tells me that people are ill-informed about how money and markets and risk work. I would suggest that pensions are too important to be left up to so-called advisers; people need to become acquainted with markets to the extent that they can self-administer their own funds if at all possible. This is not beyond the ken of any educated person with a reasonable IQ; instead people outsource the responsibility to advisers who don't have their interests at heart.

Rory Victorious Sandalwood wrote: »

What retired person, with more than 2 brain cells, would have any portion of their pension fund in stocks? Nobody.

Approaching retirement age you move to cash and low risk options.

As I mentioned, moving entirely to bonds and cash is actually the more risky option than if you were to maintain exposure to different asset classes, including some equity. Why? Because after taxes, fees and inflation, a portfolio with zero stocks is likely to leave you behind in real terms.

I would, however, say that no-one should be invested in the stock of only a small number of companies (people who had all their money with BOI or AIB for example were truly stupid); rather one should own the whole market through a passive, low cost index fund which should be available through any decent pension provider.

If a 70-year-old today retired 10 years ago with a portfolio of 900k and decided to keep 30% of it in stocks and invested that 30% (300k) into total world stock market index fund in October 2006, by November 2008 his 300k would only be worth 139.5 K. He would have lived off his bonds and cash during that time.

However, by December 2010 he would have regained his entire 300k plus an extra 8%, plus the growth of whatever percentage of his bonds he rebalanced back into his stocks in 2008 / 2009.

By October 2014 his original 300k would have surged to around 430k.

As of today, the original 300k would have grown to 441k.

Similarly a retiree in 1999 who ditched all his stocks would have been happy to miss out on the Dot Com Crash; notwithstanding that, US stocks today are around 250% higher today than they were on 31 December 1999.

A stockless retiree in early 2008 would also have considered himself lucky to miss out on the Great Recession but would have missed the 235% rebound since the low point of that crash.

There is a massive opportunity cost to having no exposure to stocks, as long as you have the temperament to ride out the storms.

hmmm

FURET wrote: »

People are terrified of stock market crashes when the reality is that they should be welcomed by anyone who isn't retired.

The best comment on this thread, and the one most people don't realise. Shares must be one of the few things that people rush to buy when they're expensive, and sell when they are cheap.

2008/2009 was a godsend for anyone who held onto their job and could contribute to a pension scheme - any money you put in then has probably doubled.

The J Stands for Jay

Rory Victorious Sandalwood wrote: »

35% in stocks when over 60 years of age is madness in my opinion.

Madness to have so little.

ytpe2r5bxkn0c1

McGaggs wrote: »

Madness to have so little.

I disagree completely. I have been there and know the risks to a pension fund if you carry a third or more of your fund in stocks at that stage of the investment.

But, do as you wish with your money. I managed mine and enjoy the rewards virtually risk free and a solid income guaranteed. 18 years into the pension at this stage and no drop in income apart from a slight drop for the pensions levy which has now been restored in full.

FURET

Rory Victorious Sandalwood wrote: »

I disagree completely. I have been there and know the risks to a pension fund if you carry a third or more of your fund in stocks at that stage of the investment.

But, do as you wish with your money. I managed mine and enjoy the rewards virtually risk free and a solid income guaranteed. 18 years into the pension at this stage and no drop in income apart from a slight drop for the pensions levy which has now been restored in full.

I would be genuinely interested to know what your pension is invested in, and whether you intend to leave any estate.

If your pot was big enough to start off with - for instance, multiples of what you actually need - then fair enough (but one would still at the mercy of a prolonged bout of high inflation). For most people, whose pots would not be large, a portfolio of cash and bonds will shrivel up eventually as it cannot possibly outpace the impact of fees + inflation over 30 years.

Now if one were to derive additional income from, say, a combination of rental property, a business, and the old age pension, one probably wouldn't be under any pressure and one could forego stocks.

However, for the vast majority, zero exposure to stocks throughout retirement is ill-advised to put it mildly. You might disagree, but experts - i.e real experts, such as Jack Bogle - recommend a permanent exposure to stocks.

ytpe2r5bxkn0c1

FURET wrote: »

I would be genuinely interested to know what your pension is invested in, and whether you intend to leave any estate.

If your pot was big enough to start off with - for instance, multiples of what you actually need - then fair enough (but one would still at the mercy of a prolonged bout of high inflation). For most people, whose pots would not be large, a portfolio of cash and bonds will shrivel up eventually as it cannot possibly outpace the impact of fees + inflation over 30 years.

Now if one were to derive additional income from, say, a combination of rental property, a business, and the old age pension, one probably wouldn't be under any pressure and one could forego stocks.

However, for the vast majority, zero exposure to stocks throughout retirement is ill-advised to put it mildly. You might disagree, but experts - i.e real experts, such as Jack Bogle - recommend a permanent exposure to stocks.

I at no point said zero exposure to stocks, just that 34-40% was too high for a retired person. My pension is invested across a wide range.

As for an estate, excluding the family home, I'd leave about €600k cash and bonds alone if I died tomorrow ...God forbid.

Corruptedmorals

About 500 quid. I moved to the public sector this year, no other previous job had it off the bat and as Im still in my 20's I dont care at this stage.

Giacomo McGubbin

Rory Victorious Sandalwood wrote: »

I disagree completely. I have been there and know the risks to a pension fund if you carry a third or more of your fund in stocks at that stage of the investment.

But, do as you wish with your money. I managed mine and enjoy the rewards virtually risk free and a solid income guaranteed. 18 years into the pension at this stage and no drop in income apart from a slight drop for the pensions levy which has now been restored in full.

I know you like to gloat about your money and how well off your are, but perhaps you don't have to do it on every page ?

Winterlong

Giacomo McGubbin wrote: »

I know you like to gloat about your money and how well off your are, but perhaps you don't have to do it on every page ?

He is talking about his pension on a thread about pensions. Nothing wrong with that.
Block him if you do not want to see his posts!

Giacomo McGubbin

Winterlong wrote: »

He is talking about his pension on a thread about pensions. Nothing wrong with that.
Block him if you do not want to see his posts!

I would have thought it perfectly possible to discuss pensions in detail without bumming about how well off you are at every opportunity. Most other people on the thread seem to be able to do that.

FURET

Rory Victorious Sandalwood wrote: »

I at no point said zero exposure to stocks, just that 34-40% was too high for a retired person.

In fairness, you did say:

Rory Victorious Sandalwood wrote: »

What retired person, with more than 2 brain cells, would have any portion of their pension fund in stocks? Nobody.

Approaching retirement age you move to cash and low risk options.

...which sounded very categorical.

FURET

Giacomo McGubbin wrote: »

I would have thought it perfectly possible to discuss pensions in detail without bumming about how well off you are at every opportunity. Most other people on the thread seem to be able to do that.

The better approach would be to ask him how he became so well off and try to emulate his success as far as possible. People love to hear how others are struggling, but not how some people succeed.

Giacomo McGubbin

FURET wrote: »

The better approach would be to ask him how he became so well off and try to emulate his success as far as possible. People love to hear how others are struggling, but not how some people succeed.

Why is it necessary in every post though ? It's perfectly possible to discuss the subject in detail without repeatably bumming in every post about how well off you are.

FURET

Giacomo McGubbin wrote: »

Why is it necessary in every post though ? It's perfectly possible to discuss the subject in detail without repeatably bumming in every post about how well off you are.

I see it as him stating the facts about his pension in a thread about pensions. I don't see arrogance, more a sense of accomplishment, to which he is entitled at his point in life. I hope we are all as comfortable as Srameen when we are in our 70s.

suicide_circus

Angous's granddad!!

MeatTwoVeg

twinytwo wrote:

The state pension will be gotten rid of in the next decade and then most of the public pensions will go as well.

The State pension will last a lot longer than a decade, but it will by no means be as generous as it is today in 30years time.

Public service pensions are essentially a pyramid scheme, can't see them surviving in their current form beyond the next generation. The private sector workers of tomorrow will not be willing to pay punitive taxes to keep retired public servants in the style they've become accustomed to.

Moo Moo Land

MeatTwoVeg wrote: »

The State pension will last a lot longer than a decade, but it will by no means be as generous as it is today in 30years time.

Public service pensions are essentially a pyramid scheme, can't see them surviving in their current form beyond the next generation. The private sector workers of tomorrow will not be willing to pay punitive taxes to keep retired public servants in the style they've become accustomed to.

You're missing one key point - politicians are public servants and will make sure the status quo is kept.

MeatTwoVeg

Moo Moo Land wrote:

You're missing one key point - politicians are public servants and will make sure the status quo is kept.

Politicians are only politicians for as long as private sector voters elect them.

ytpe2r5bxkn0c1

Giacomo McGubbin wrote: »

I know you like to gloat about your money and how well off your are, but perhaps you don't have to do it on every page ?

Just answering a question honestly. Don't let it annoy you, I was asked and I answered. What did you want me to do? Lie?

ytpe2r5bxkn0c1

FURET wrote: »

In fairness, you did say:



...which sounded very categorical.

Yes fair enough. I didn't mean to be that empathic. My apologies, I meant any sizeable amount in reply to a suggested 35 to 40%. Again, I apologise.

Irish_rat

My pension is 4 times my salary after 10 years, not sure if that's good or bad

ytpe2r5bxkn0c1

Irish_rat wrote: »

My pension is 4 times my salary after 10 years, not sure if that's good or bad

If you mean your pension fund value is 4 times your gross annual salary and you are on a reasonable annual salary, then that's decent enough after 10 years

ytpe2r5bxkn0c1

Giacomo McGubbin wrote: »

Why is it necessary in every post though ? It's perfectly possible to discuss the subject in detail without repeatably bumming in every post about how well off you are.

I have 11 posts (now 12) on this thread and I think I mentioned my pension value twice. The OP asked specifically what our pension funds are worth hence the first answer and another poster asked if I'd have an estate left, hence the second.

It's the nature of the thread and can't be discussed without values. What difference is there between someone posting about a poor pensions fund figure and someone posting of a decent pensions fund?


Exaggerate much?

Moo Moo Land

MeatTwoVeg wrote: »

Politicians are only politicians for as long as private sector voters elect them.

I believe the largest profession in the Dail are teachers.

Fiskar

MeatTwoVeg wrote: »

The State pension will last a lot longer than a decade, but it will by no means be as generous as it is today in 30years time.

Public service pensions are essentially a pyramid scheme, can't see them surviving in their current form beyond the next generation. The private sector workers of tomorrow will not be willing to pay punitive taxes to keep retired public servants in the style they've become accustomed to.

This lad has been raking it in since retirement. Will be 100 years old shortly

https://en.wikipedia.org/wiki/T._K._Whitaker

The Rape of Lucretia

MeatTwoVeg wrote: »

Politicians are only politicians for as long as private sector voters elect them.

Do public sector workers not vote ?

MeatTwoVeg

The Rape of Lucretia wrote:

Do public sector workers not vote ?

I'm sure they do but they're less than 25% of the workforce, and an even lower percentage of the electorate.

MeatTwoVeg

MeatTwoVeg wrote: »

The State pension will last a lot longer than a decade, but it will by no means be as generous as it is today in 30years time.......

Indeed.

If the non contributory pension is reduced you can imagine the scenes, the water charge folks will be out again. Politically the contributory pension has to be more than the non, it will take huge huge effort to make major reductions in either.

Their is a problem with the future state pension bill but that problem won't be solved by reducing the bill to a huge degree, the pain will be in funding it imo.

MeatTwoVeg

Augeo wrote:

Their is a problem with the future state pension bill but that problem won't be solved by reducing the bill to a huge degree, the pain will be in funding it imo.

In terms of the demographics, Italy is a couple of decades ahead of us. We'll have the advantage of seeing how things pan out there.
Trying to attract migrant workers to fund pensions of an ageing population is obviously an option, but brings with it its own social issues.
Interesting times lie ahead.

Yup, as you mention, this isn't just an Irish problem.

Lots can change in decades

The core state pension will always have to be more or less what social welfare payments are IMO, all those pensioners will be voters too so I wouldn't be fearing the worst.

Also all those pensioners will also be consumers, it's not as if they'll be saving the weekly payment and it won't be going on mortgages or car loans etc, much of it spent in local economy, the actual problem may not be as big as feared.

All those private nursing homes need to be staffed and payed for, lol.

A_Sober_Paddy

How does tax relief on pension contributions work.

For example

Earnings(before tax) 27,000
Pension contributions 3,000

How much could that person claim back at end of tax year?

A_Sober_Paddy

A_Sober_Paddy wrote: »

...........
Earnings(before tax) 27,000
Pension contributions 3,000

How much could that person claim back at end of tax year?

20% of €3000.
Employer should facilitate in most cases at source.


20% 0-€33,800 earned income for individuals without dependent children

A_Sober_Paddy

Augeo wrote: »

20% of €3000.
Employer should facilitate in most cases at source.


20% 0-€33,800 earned income for individuals without dependent children

Company I work for are useless for that stuff, I was getting underpaid for my 1st year, it took 12 months to sort it.

A_Sober_Paddy

A_Sober_Paddy wrote: »

Company I work for are useless for that stuff.........

http://www.pensionsauthority.ie/en/LifeCycle/Joining_a_plan/Employers_obligations_to_provide_access/

"make deductions from payroll at the request of employees and remit these to the designated PRSA provider (employers cannot charge for deducting and remitting contributions"

They want to get better, they are obliged to