nun

Well the UK Government can say that, and does if they let you in. However, that creates different classes of residents for benefits purposes which I think is wrong.

robin1234

I could say, maybe it is Kroniskt Obstruktiv Lungsjukdom (Swedish: Chronic Obstructive Lung Disease) or Kingdom of Loathing (online game)... but in this context it is the Knowledge of Life test http://lifeintheuktest.ukba.homeoffice.gov.uk/

robin1234

Another thought about the fact that some people have significant cash savings and others have less(and thinking primarilly about couples at retirement age, because that is where I am in life...)

Take two people living in the United States with similar jobs and similar salaries over the course of 20 years. One has a defined benefit pension, the other a defined contribution pension. The one with the defined benefit pension may have a reasonable income, US SS plus pension from work, but not quite enough to satisfy the new British requirements, so cannot return to live in the UK with his or her American spouse. The one with the defined contribution pension might be worse of in the big picture, since his/her retirement savings may translate to a smaller paycheck each month, but they CAN fulfill the new UK requirements because the defined contribution account will add up to way over $100,000 ...

chocciecake

can i ask then, based on the following quote from the ukam website, does this mean, as a wife with ILR of a british citizen, with british born children,i am exempt from having to do the KOL test?

"Exemption for certain immigration categories

You will not have to meet the KOL requirement if you are being granted settlement outside the Immigration Rules, or if you are applying for settlement as:
a parent, grandparent or other dependent relative of a British citizen or someone who has settled here (under paragraph 317 of the Immigration Rules);"

Giantaxe

Presumably one would be allowed to do an actuarial valuation of a defined-benefit pension. I don't see this distinction as being an issue.

dunroving

This is already in place for the new laws regarding limitations on the amount you can contribute tax-free (or pre-tax) to a UK pension. For those with a pension pot it is simply the amount (£50k?), but there is a formula for people contributing to a defined benefit scheme. Presumably the same formula could be applied in this case to determine the worth of a given number of years' contributions to a defined benefit scheme.

nun

By definition the DB plan has already had an "actuarial valuation" . The point is that the principal on which the DB is calculated might be far larger than the balance in a DC plan, but the owner of the DB plan might not meet the income requirements while the owner of the DC plan would meet the savings requirement.

robin1234

Yes, that was my point.

And I think it is part of a bigger, problematic picture. It is stated on p.17 of the new rules that "The Government is not looking to draw up a personal financial balance sheet for each sponsor (outgoings, credit card and other debts, mortgage, etc), but taking £18,600 as a benchmark.."

Why WOULDN'T they take those other things into account; because it is too hard for them?

Bob

You're forgetting Brits who are UK citizens by decent, who can't pass on UK citizenship by default, unless living in the UK.

englishguygoinghome

If you have ILR already then you have ILR and don't need to apply for anything or take any further tests. (but if you want to apply for citizenship then you would need to take the test)

Giantaxe

Ok I see your point.

I did see this text as regards to defined-contribution plans:

So that at least tells us that defined-benefit retirement savings are disregarded prior to retirement age, which is the correct treatment vis a vis defined benefit plans.

What should really happen post retirement age is that one's defined contribution savings should be notionally converted into an annuity and that notional annuity income used. That would make a level playing field between DB and DC "savings".

And all this begs the question of what "retirement age" is.

robin1234

In this context, I assume they are referring to age 59.5 (in the case of USA retirement funds) because that is when the individual has more-or-less unrestricted access to their funds.

robin1234

Yes; I was surprised when I saw that one "only" needed 62,500 pounds in savings. Sure makes it easier for many applicants of retirement age, rather than having to annuitise or notionally convert to an annuity.

Giantaxe

Possibly. Of course, that might mean "retirement age" is different for savings from different countries that have different rules etc. I really doubt whether these nuances have been thought through.

nun

Well you can get access to your US retirement funds at any time, but you will have to pay the 10% penalty unless you do a 72t Substantially Equal Payments plan. That basically lets you do penalty free withdrawals before 59.5. The amount of the withdrawal is calculated according to actuarial tables, just like an annuity.