Work Pensions

 

This year, I've become a freelancer again, which means I get to go over my own finances. While looking through my financials, I decided to take a look at my work pension from my old job. This snippet jumped out to me. 

This policy was started in 2017, so it's about five years worth, but this figure is calculated on the assumption I'd stay on the plan until retirement age. This plan was set at the legal minimum requirement, so yes I could've paid more into it, but even the next level of contributions would've severely limited my take home pay that at that level was just covering my living costs, rent, bills, food etc. So it wasn't really a viable option, even a reduction of £20-30 every week would put me on shaky ground budgeting wise, and all for the promise of a minor increase in the year 2058. I was working for the national minimum wage an average of 42 hours per week, though it was not unusual for me to work more than that, and when I started at this job my hours were 60 per week with sometimes even more. The reason we were set to 42 was because me and another employee gave formal notice that we weren't prepared to do any more, and the company backed down. 

Work pensions were a controversial thing in 2017-18, but have largely fallen into the background since they were introduced. Personally, I think they're a terrible reform that should be scrapped. For workers on the lower salary ranges, they add another burden on take home pay, all for frankly nothing decades later, what will inflation look like in 2058? Will there even be a Pound currency or nation? I'd much rather have that £42 in my account now, so I can use it or actively save it, it wouldn't be remotely life changing, but it would be of use to me. Meanwhile, for higher incomes, they act as an extra incentive for loyalty to the company. I've seen several job listings that have a special workplace pension scheme that pays more than the government mandated system, and when I shared this information elsewhere, several labour aristocrat types showed up to condescend about how great their 401ks are and that I should pay more into my fund. So, it's worked on some people. 

Hell, I had one person give me details on how much their pension plan works, and he didn't seem to bat an eye that the employee pays more in percentage than the employer does, so even the matching part of the system has already been abandoned. Sadly, there are people out there who are so easily blinded by the promise of future money, they don't even care that the employers pay less than they do in a fund that was pushed on the message of "we're all in". If you pay 5% and your company only pays 4% (as in his example) they're ripping him off for an 1% and if he's already surrendered that 1% with good grace than he's already signalled that he can be ripped off provided it's handled appropriately.