Money, investing, mutuals etc
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blythburgh
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by blythburgh » Sun Feb 13 2022 7:37am
DWP freezes auto-enrolment qualifying earnings band triggers
Thousands more workers will be automatically placed into a pension as 'earnings trigger' is frozen at £10,000
So if you are on a low income with food and energy prices rocketing you will have to pay more into your pension and you will have to pay more for your National Insurance from the start of the next financial year.
Of course the Chancellor could have chosen to increase income tax instead of NI which would hit the better off as NI starts at a lower earnings threshold than income tax and for the better off it drops dramatically
For 2021-22, the Class 1 National Insurance threshold is £9,568 a year. If you earn less than this, you won't pay National Insurance contributions.
If you earn more, you'll pay 12% of your earnings between £9,568 and £50,270. You'll pay 2% on any earnings above £50,270.
Keep smiling because the light at the end of someone's tunnel may be you, Ron Cheneler
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Chadwick
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by Chadwick » Sun Feb 13 2022 10:50am
Would income tax be paid back to you when you retire?
This pension change is not just about raising revenue today. It is also about saving on the cost of pensions in the future.
(If you're feeling altruistic, it is about ensuring people have some money in their retirement, but I doubt that was a motivating factor for this government.)
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macliam
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by macliam » Sun Feb 13 2022 11:32am
Indeed, whilst it may seem a good idea to "ensure" that people save towards funding their retirement..... they already do as part of their NI payments. The state pension was supposed to provide sufficient to live in old age - other pension arrangements were voluntary. Once a contributory pension is in place, the idea that the state pension should be any more than token goes out of the window.
It's a bit like taking the idea of an NHS free at the point of use and making you pay privately for things like dental or optical treatment - or for the medicines you need. What government would possibly do that?
Just because I'm paranoid, it doesn't mean they're not out to get me
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pabenny
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by pabenny » Sun Feb 13 2022 1:16pm
macliam wrote: ↑Sun Feb 13 2022 11:32am
..The state pension was supposed to provide sufficient to live in old age...
Was it? I don't know.
But I do know that we are living much longer than when universal state pensions were introduced in 1948.
macliam wrote: ↑Sun Feb 13 2022 11:32am
...we already (save for old age) as part of our NI payments...
Not true. Today's state pensions are paid from today's taxes and national insurance - there is no pension fund.
One of the aspects of having an ageing population is that the proportion of pensioners to working age people is much higher (and forecast to grow further).
When today's workforce retire, there just won't be enough people of working age to pay their pension, so we
all need to save for ourselves rather than just relying on the state pension.
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macliam
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by macliam » Sun Feb 13 2022 2:53pm
Please don't change my words and claim it as a quote, I am aware of the actual use of the money from NI payments. However, as the amount of state pension payable is based on the number of NI contributions made, to suggest that there is no link between making NI payments and future pension provision is both fatuous and a Johnsonesque diversion from the truth.
The fact that people are living longer is used as an excuse for everything from energy use through a housing shortage to the provision of pensions and social care. This is nothing strange, it just requires plans to change - but such changes stretch beyond the next election. If extra funds are required, there are many ways to provide them..... without handing wads of cash to private companies. Given that there is a housing shortage, the idea of investing current income to provide both housing and a future source of funds seems one way to "change plans".
Workplace pensions are merely a way to funnel even more of workers pay into the financial institutions of the City. These funds are not cost free, they do not have a guaranteed return..... and the workers have a very limited choice of action. At the same time, the government raise money through City institutions, both for infrastructure and for the current account, at a guaranteed rate. It would not have taken genius to remove the profit-motivated middle man.
Just because I'm paranoid, it doesn't mean they're not out to get me
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blythburgh
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by blythburgh » Mon Feb 14 2022 7:47am
There is only one reason we have a housing crisis. The private sector continued to build but Council Housing was sold off and some of it is now in the hands of private landlords. This means a) the renter pays more and b) in often the renter is getting money from the Govt. towards the rent.
Money from the sale of the housing stock was not allowed to be use to build more. And now the Tories want to make the right to buy to be available to Housing Association tenants.
I can remember reading a very local paper on holiday. In Wells Next the Sea a charity was set up to buy houses to be rented out to local people as they could see the growth of second homes and the affect it would have on young people in the area. They were persuaded to become a Housing Association to benefit the charity the most. Now they are scared the homes they have bought for the local people will have to be sold if the tenant wants to buy it. And too many of those houses will no longer be available at a reasonable rent 365 days a year.
But not to worry the rich will benefit. As my late neighbour said once to me "we bought our Council flat and sold it for an obscene amount and it is now being rented out again." The flat was in Tottenham and meant they could buy a very nice family house in Romford. So they benefited but the local and national tax payer lost out.
Keep smiling because the light at the end of someone's tunnel may be you, Ron Cheneler
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expressman33
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by expressman33 » Mon Feb 14 2022 11:03am
blythburgh wrote: ↑Sun Feb 13 2022 7:37am
For 2021-22, the Class 1 National Insurance threshold is £9,568 a year. If you earn less than this, you won't pay National Insurance contributions.
If you earn more, you'll pay 12% of your earnings between £9,568 and £50,270. You'll pay 2% on any earnings above £50,270.
Unlike income tax which is calculated cumulatively , NI is calculated either weekly or monthly depending on how you are paid ,so if someone is only earning £7,000 pa buts gets a one off bonus or works a load of overtime in one period, they could also pay NI . Also affects someone just below the threshhold who is paid monthly on a 4,4,5 basis .
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