tazziecat

Hi

Does anyone have any info on if you have no other pension in the uk but the state one, how would this fare with living and paying in for the next 20 years to a employer based Superannuation pension scheme in Australia, I know it depends on your earnings but just the average earings is what I would base it on.
Really what we need to know where are we better off by the time we get to retirement UK or Oz.

Thanks
Tazziecat

Grayling

It's a completely different system

Australian superannuation is very different to a UK state scheme.

You could easily set up a scheme similar to the Australian Super scheme in the UK.

Super schemes cost much more than a state system.

Why not compare the two state systems if you want a proper comparison?

Amazulu

I think that just paying in the standard 9% for 20 years would not be enough to retire on - you would need to make subsantial extra payments. Under the Aussie system this is easy to do and through tax breaks, encouraged.

Aussie system is far, far superior to UK system.

Grayling

Nowhere near superior to my NHS pension in the UK.

You are not comparing like for like.

G

Amazulu

I know nothing of your NHS pension. Good luck to you.
Aussie Super system, with it's better tax breaks is far superior to UK private/company (non final salary) pension system.

Grayling

Possibly.....but the OP was trying to compare the UK state system with the Australian super system.

They are completely different animals so no realistic comparison could possibly be made.

One is funded by the NI and tax system (UK state) and the other by a combination of employer/employee contributions......at a much higher level.

G

Wheeler-Jones

Public servants pensions might be guaranteed for yourself however the money I am currently paying in tax for my non public servant role the UK is NOT guaranteed and is really only covering the current pensioners. If I stay in the UK I won't be assured of decent support by the government at retirement age.

Australia's superannuation payments are included/on top of your wages are are mandatory. They go into a fund that is YOURS and cannot be used by anyone else - you get control over how it's invested to an extent as well.

The 6 years of NI and tax I have paid here in the UK mean nothing to me when I am 65 (or 70 as it probably would be by then). On the other hand, the money I earnt into a super account in Australia whilst working there, will stay there earning interest until I am old enough to use it whether I go back or not.

If I was staying in the UK I would not be relying on the government - I would have to set up a private scheme. In Australia I am glad that it's mandatory - makes it alot easier to 'decide' to save for your retirement. And then the tax breaks for additional payments are always good.

I agree with the majority here - the Australia scheme is far superior for the majority of people (and not just government workers).

Grayling

That is not the point I was making.

The OP was asking about the UK state system as opposed to the Australian super system.

A more realistic comparison would be against the Australian STATE system which is similar to the UK system but is means tested.

There is nothing to stop anyone in the UK setting up a private pension which the employer would also contribute to.

If you add the UK state pension to a Uk private system then it would compare very favourably to the Australian system. Most people recieving super in Australia would not recieve their state pension because of the means testing......which is why the system was devised in the way it is.

saveme

Ten years ago I would have scoffed at this sort of question but now I'm nearly 54 I am SO interested in it in particular how it affects my retirement to Australia.

I worked for the Commonwealth Govt in Sydney for fifteen years before being made redundant in 1996. I've got a Com Super Pension that currently pays $212 per fortnight. I've also got a couple of Super funds which have been more or less dormant since I came back to UK.

I've worked for Royal Mail for twelve years and I'm paying all I can into their pension scheme.

I've got to find out if there are any restrictions on paying the Royal Mail pension when and if I return to OZ. I know that whatever UK Old Age Pension I'm due will be frozen at the rate at which I leave the UK. There was a pensioner from South Africa trying to fight a court case about this as it only applies to people retiring to SA/OZ/NZ/Canada???? not retirees to EC or USA???

That's interesting about Aussie super being superior to UK? I must try and get some independent financial advice as to whether it's worth making extra payments into my Aussie super fund.

I want to come back to Sydney this year but some people advize me to hang on with RM till I'm 60 and can take the pension. Good advice but I'm feeling the tug of my family in Sydney.

Thanks for any gratis advice!!!!

Dave

jad n rich

Australian superfunds invest a huge portion in the sharemarket, returns the last 2/3 years were raved about.

Now onto this years sharemarket funds have lost billions.

Make your own conclusions on where that leaves you if say for eg you were retiring next few years.

Read the fine print, what % of share risk can you handle with your retirment funds.

As for the australian state pension its means tested.

Superannuation is not mandatory for all employees, if your subcontracting on a building site for eg, your super has to be paid by YOU, employer pays nothing, same for many jobs if your working subcontract or under your own ABN.

Wheeler-Jones

This made me think about what the pension guy at work said to me yesterday (and I am talking UK pension funds through your work) - basically every pension fund has a massive deficit thanks to the fact that people are living longer than they were 10, 20 years ago. Every month that our lives are extended costs the pension funds huge. I can see why they often are a little risky.

Basically hubby and I are going to keep a couple of options in a couple of places, just in case one does gets a bit risky. Either way I think we all need to look after ourselves a bit in case the sh*t does hits the fan in UK or Oz.

saveme

The Royal Mail is a good scheme - final salary - but we keep getting news of changes (usually for the worse).

I keep meaning to contact them to see if my pension is still paid the same if I move to Australia.

I know the UK State OAP is paid at the rate on the day you left the UK. i.e. no increases for inflation/cost of living index. It's blatant discrimination against people who retire to the former Dominion countries solely because there are so many of them (us). You may want to get a forecast of your UK state pension - can't remember which Govt Dept it is.

Amazulu

IMO the Aussie system is far superior to the UK one. The compulsory nature of super added to the fantastic tax breaks make for a very good and healthy setup.