London abolishes the obligation to annuity, 55 can each withdraw his money. Critics fear that this might be more old people to the state are on the bag
From Nina Trent man
If you want private provision for old age, the has in the UK currently is not much choice. Since 1921, the law stipulates that savings on entering the retirement age in an “annuity”, an annuity, to be converted, which is paid until death. This is starting next spring are different – after almost 100 years carded Chancellor of the Exchequer George Osborne, the pension law fundamentally about. The British will no longer be forced to put their “pension pot” of occupational pension and private provision in an annuity. You can, as soon as they are 55 years old, be paid out their money – at the risk that they have spent a few years everything and the State are as impoverished pensioners on the pocket. This keeps the Finance Minister, however, for not very realistic, but he hopes that the reforms make the private pension saving more attractive. At the same time it sets up the retirement age. So the cost of the demographic development are to be shouldered. In Germany contrast, the pension age is lowered, the willingness to private pension returns.
It was for many private pension insurer quite a shock, because what Osborne announced in March, when he presented his budget for the current year. Within hours, rushed from the courses of large insurance companies, at the end of the day they had lost billions in market value. The Liberation of age savers from the compulsion to change the pension annuity market in the UK considerably. They had been trapped in their contracts: An “annuity” was valid until the end of life; who wanted to terminate the contract prematurely, had high penalties in buying take
Because of the low interest rates, the annuities were last always like this. Whoever 30,000 pounds, about 38,000 Euro, had been paid, could expect an average annual payment of around £ 1,000 – not enough to just be contested in the everyday life of it. “An annuity was always only one component of many,” says Danny Cox, Hargreaves Lansdown head of department at, a large provider of financial services in the UK. “The problem is that the British have established over the years too little money back,” says Cox. High cost of living, home loans and consumer loans led to an astronomically high private debt of more than 1.43 billion pounds, the equivalent of around 1.8 trillion euros. “Most of the people The savings are too low, we have a huge gap,” says Cox. Even in areas with low cost of living, such as in the north of England, need pensioners on average about 12,000 pounds per year, added mostly expensive medical treatments and medications.
The liberal-conservative government hopes that the British swift invest through the new flexibility and be more concerned about their retirement. Towers Watson, a London-based market research firm, estimates that by the year 2023 could be around £ 50 billion flowing into the private pension market, three times as much as today. The annuities made so far about twelve billion pounds from, the Association of British Insurers. This market segment is now shrink significantly.
Starting next spring, the British can create their “pension pots” or so-called funds or “super annuities” stuck in annuities with more flexibility. Feared, however, that not all come out of their current contracts and that some of them have to pay penalties for early termination of contracts. “The government needs to help people who are stuck in contracts with low yields,” said Richard Lloyd, director of consumer organization “Which?”, “So that they can benefit from the advantages of the new contracts without their savings will be eaten up by penalties. “
UK based in the reform of the private pension market in Australia . There is a similar model, the land currently under discussion but to return to the annuities, is but the rising life expectancy many Australians is a major problem: It is difficult to predict how long they will live and how long will the money they in their “pension pot” have. “There is the fear that people will take their money and bang on the head,” says David Robbins, consultant at research firm Towers Watson. However, this is not realistic: From 2016 the basic state pension in the UK will be around £ 8,000 per year, in addition, there is only the housing allowance and social assistance. “With the state pension alone is life more miserable,” says Robbins, “which is not particularly attractive.”
This is also the position of Chancellor of the Exchequer Osborne, who believes that the reforms are rather than encourage his countrymen to save on riotous living. Nevertheless, the uncertainty is large, many Britons are reluctant to make investment decisions. Therefore provide the consulting services of the government, including the “Pensions Advisory Service”, their free service to. Per year to about 400,000 Britons in pension forecast to about 150,000 of them in 2015 will make use of the new freedoms.
In Germany there are no obligation to enter into an annuity. “You can theoretically make everything pay off what you have saved privately or with the help of the operation,” says Klaus Morgenstern, spokesman of the German Institute for retirement. Only at the Riester pension there is a requirement that at most 30 percent of the investment amount may be taken. “The rest has to be applied for the pension,” says Morgenstern. In his estimation, the federal government is sending wrong signals to the reduction of retirement age. “We look for three or four years that the willingness to save for old age back,” he says. One reason for this are the low interest rates, and the poor image of the Riester pension wear to this. “Many people think that shoe uppers is not worth it.”
UK goes with raising the retirement age in the opposite direction. It should first increase to 67 years later at 70 years. Measures such as the “auto enrollment” to ensure that more British company schemes have. Employers must therefore provide all their employees with a company pension. “The signals are very clear,” says Robbins of Towers Watson, “the people are to form as early as possible reserves for old age.” In Germany there has been no obligation to occupational pension. “In large companies is the provision of occupational pensions, no problem,” says Morgenstern. “In small and medium-sized companies, there are still big problems, the distribution of occupational pensions is there very low.” For Chancellor of the Exchequer Osborne, the reform of the private pension market has another advantage. He can look forward to additional tax revenue, because 75 percent of the funds in the “pension pots” of the British must be taxed. In the next five years so, around four billion pounds flow into the state treasury.
No comments:
Post a Comment