Oh our futures look intresting dont they!

  perpetual motion 23:40 08 Apr 2009
Locked

As if things cant get any worse, im so glad im not in my "Latter" side of my life, i do feel for pensioners & i suppose this could have VERY long lasting affect for my generation too.

click here

  Kevscar1 00:30 09 Apr 2009

Well my mortgage payments have dropped by over £400 per month and if the rate goes much lower RBS will be paying me so it.s not all bad

  Grey Goo 00:32 09 Apr 2009

If you take the view that a recovery will happen,investing in equities that are seriously undervalued at the moment may prove beneficial in the longer term. If you already draw on an annuity then rates have fallen and incomes have suffered.

  Grey Goo 00:37 09 Apr 2009

If I had a mortgage I would probably keep the payments at a higher level than was required in order to pay the capital off quicker, if there were no penalties for doing so. This is a great opportunity to reduce overall mortgage cost if you can afford to do so.

  perpetual motion 00:56 09 Apr 2009

GreyGoo i aggree totaly, Kevscar yeah its not all bad its quite nice too hear people have a reduced mortgage...

  laurie53 07:16 09 Apr 2009

"If I had a mortgage I would probably keep the payments at a higher level"

My mortgage repayments have recently dropped by 60%, and I tried to maintain my payments at the higher level, only to be told that I would have to set up a new mortgage agreement.

I now put it in an ISA, with a different bank.

Can banks really afford to be so inflexible?

  natdoor 12:25 09 Apr 2009

Existing pensioners are not affected by a drop in fund values or of annuity rates. Workers in defined benefit schemes are not affected unless the company fails and then they would get significant compensation from the Pension Protection Fund. Of course, if the situation deteriorates drastically, this may need to be underwritten by the Treasury.

Potentially affected workers are those with private pensions. Those more than a few years from retirement will probably benefit by purchasing assets cheaply at the moment and seeing their fund increase along with increasing asset values. Those within a couple of years of retirement should have followed the recommended procedure of switching to cash and bonds a couple of years ago.

In some jurisdictions, the pension fund is paid out in full in cash on retirement and the individual is responsible for its management. This is fine when things are going well but can be disastrous in the curent climate. Of course, one should not have all eggs in one basket but, without the trigger of a retirement date to focus on, when it is in the past, asset protection may get overlooked.

  Grey Goo 15:06 09 Apr 2009

Perversly annuity rates are shooting up, I assumed they would be plunging as other investments are, funny business this finance, seems the insurance companies are cutting each others throats to bag the most customers and so are escalating the rates. How long can it last i wonder.

  rawprawn 16:04 09 Apr 2009

I am retired and my private pension fund has collapsed (No company pension fund) My income from dividends has collapsed, and the income from interest on hard saved money is non existant.
Meanwhile inflation for pensioners, council tax utilities and food is running at at about 10%
perpetual motion got it right.

  natdoor 17:49 09 Apr 2009

You appear to be in the unfortunate position of having retired and not taken an annuity. I sympathise with you. Dividends are holding up in some sectors, although not in banks which hitherto were producing good yields.

However, there will not be a large number of pensioners in your position. I think I am correct in saying that private penions do not have to be converted into annuities until age 75 and income drawdown is available until then. This can result in a situation not dissimilar to the one existing in some other jurisdictions to which I referred earlier.

  Jim Thing 18:05 09 Apr 2009

My luck has been somewhat better than yours, I think.

Having knocked about a bit during my working life it was a nice surprise to find, when I retired, that I was entitled to the lion's share of a state pension from UK, another from Europe, and two smaller pensions from Canada (one federal and one provincial).

Considering the currently dreadful state of sterling against the € and the CAN$, those overseas parts of my retirement income have come in very handy in recent months to help counter the pathetic interest rate on savings.

So it's an ill wind, etc. — but one day no doubt the pendulum will swing back again...

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