Pensions

[opothai]

although pensions seem a good idea, after reading some articles my thoughts are very negative.

i have a couple of pensions [ with profits]

after reading hier blair is going to retire with a pension of 140,000 gbp i was gobsmaked to read that to get a pension of that size at the age of sixty, you would have had to made a contribution over the years of no less than 5.1 million yes 5.1 million.

given these figures i find myself thinking seriously about freezing my seemingly poultry contributions.

i know zero about pensions, but one question that maybe someone could answer is

given that i have paid my pension, and start to recieve my said pension,

if i were to die early would my wife [ thai ] carry on recieving my entitlement until at least my contributions would have been matched.

[bendix]

Well . .if you've paid your pension contributions in chickens, rather than real currency, you can't too much more can you?

[Phil Conners]

Does that have anything to do with Thailand?

[GuestHouse]

Firstly, the basis of making a pension plan should be the needs of you and your dependents, not the disparity between what you are due and that others will receive.

So my first piece of advice is - Keep Paying into your pension.

given that i have paid my pension, and start to recieve my said pension,

if i were to die early would my wife [ thai ] carry on recieving my entitlement until at least my contributions would have been matched.

Your wife is a legal dependent and will be entitled to a Widow's pension if you die before her. The pension she receives will be for the rest of her life.

A couple of things you need to address:

Firstly - Write to your pension trustees/managers and ask for a 'Statement of Wishes' form, in which you will declare that, in the event of your death, you want your wife to be the beneficiary of the pension (This will usually be two payments, a lump sum and a monthly pension - The lump sum will usually reduce to zero in the first five years of your retirement, so if you die directly after retirement your wife gets a bigger lump sum than if she waits two or three years before bumping you off

Secondly - When you write to your Pension Trustees/Managers, ask them two things:

1. Do they need proof of marriage to include your wife in your pension? and if so what (marriage Certificate, Signed statement from you, Translations?)

2. In the event of your death, how does your wife claim her pension and how does she continue to demonstrate she is still alive to claim the pension (Remember she's half a world away from the pension Trustees). Get that sorted out, get it written down, translate it into Thai and place the explanation in a safe place.

I take it you have made a will, if not do so, but do not put your pension in your Will (if you do that you can cause tax problems) The statement of wishes controls your Pension.

However, Do add an attachment to your will. A letter outlining the details of your savings, pensions and importantly, copies of the instructions to your wife of how to claim her rights.

Just Two More Things To Add.

It is very commonly the case that the Pension rules will reduce the size of you wife's pension by a small percentage for each year of age difference between the two of you. This will often start to come into effect when the age difference reaches 10~14 years after which your wife's pension will be reduced by perhaps 2% per year over the maximum allowed in the contract.

The reason is clear, she's likely to live a long time. Be aware of this and if you have difficulty working it out, ask for a pensions forcast including widows pension.

This leads to my last point - If your wife is a lot younger than you (common in Thailand) you should consider the pension she needs and the effect of inflation over her long life.

You can't change inflation of course, but what you can do is maximize the monthly pension to ensure you and she has enough for the years ahead.

Basically, if your wife is a lot younger than you, think very carefully before taking a lump sum out of your pension when you retire.

This is even more important if you have a young child as you approach retirement.

That lump sum might get you the Fortuna you've been promising yourself, but it might leave your widow, and perhaps child, with insufficient funds to live on in the years to come.

There, it was Thailand related.

Edited June 23, 2006 by GuestHouse

[GuestHouse]

Oh and don't forget your state pension. I've not looked into this fully yet, but my understanding is your wife is entitled to a UK Widow's pension when you die.

When I've looked into this I'll post more.

[opothai]

Firstly, the basis of making a pension plan should be the needs of you and your dependents, not the disparity between what you are due and that others will receive.

So my first piece of advice is - Keep Paying into your pension.

given that i have paid my pension, and start to recieve my said pension,

if i were to die early would my wife [ thai ] carry on recieving my entitlement until at least my contributions would have been matched.

Your wife is a legal dependent and will be entitled to a Widow's pension if you die before her. The pension she receives will be for the rest of her life.

A couple of things you need to address:

Firstly - Write to your pension trustees/managers and ask for a 'Statement of Wishes' form, in which you will declare that, in the event of your death, you want your wife to be the beneficiary of the pension (This will usually be two payments, a lump sum and a monthly pension - The lump sum will usually reduce to zero in the first five years of your retirement, so if you die directly after retirement your wife gets a bigger lump sum than if she waits two or three years before bumping you off

Secondly - When you write to your Pension Trustees/Managers, ask them two things:

1. Do they need proof of marriage to include your wife in your pension? and if so what (marriage Certificate, Signed statement from you, Translations?)

2. In the event of your death, how does your wife claim her pension and how does she continue to demonstrate she is still alive to claim the pension (Remember she's half a world away from the pension Trustees). Get that sorted out, get it written down, translate it into Thai and place the explanation in a safe place.

I take it you have made a will, if not do so, but do not put your pension in your Will (if you do that you can cause tax problems) The statement of wishes controls your Pension.

However, Do add an attachment to your will. A letter outlining the details of your savings, pensions and importantly, copies of the instructions to your wife of how to claim her rights.

Just Two More Things To Add.

It is very commonly the case that the Pension rules will reduce the size of you wife's pension by a small percentage for each year of age difference between the two of you. This will often start to come into effect when the age difference reaches 10~14 years after which your wife's pension will be reduced by perhaps 2% per year over the maximum allowed in the contract.

The reason is clear, she's likely to live a long time. Be aware of this and if you have difficulty working it out, ask for a pensions forcast including widows pension.

This leads to my last point - If your wife is a lot younger than you (common in Thailand) you should consider the pension she needs and the effect of inflation over her long life.

You can't change inflation of course, but what you can do is maximize the monthly pension to ensure you and she has enough for the years ahead.

Basically, if your wife is a lot younger than you, think very carefully before taking a lump sum out of your pension when you retire.

This is even more important if you have a young child as you approach retirement.

That lump sum might get you the Fortuna you've been promising yourself, but it might leave your widow, and perhaps child, with insufficient funds to live on in the years to come.

There, it was Thailand related.

thx for the reply, and i will look into the pointers you have given me. and you are correct she is 15 years younger than me.

as for the state pension hopefully i'll be retired in los by the time that comes into effect and with all the changes i doubt very much that in 20 years time thier will be any thing left in the pot for british living abroad let alone wife's living abroad, although she should have her british citizenship next year.

madsere

you sad individual, read the whole post { THAI WIFE }

but all the same very constructive comment

bendix

[GuestHouse]

The forms and paperwork required for my wife to claim after my death a share on my industrial pension are impossible for my wife to fill in and they insist that they have to be filled in after my death.

I think this is an example of why is necessary to find out how your dependents claim their share of your pension and an example of something that should be perhaps addressed by a solicitor/executor as part of the attachements to your Will.

I certainly think that you should be completing a Statement of Wishes and sending it to your pension Trustees, and I believe that they are then duty bound to ensure your dependents receive the pension for which you have paid.

I'd be right down their throats now, sorting that out.

[GuestHouse]

A solicitor here looked at the form and said that he would not be able to help her and the British Embassy will not either.

Get another Solicitor. One who understands that he can act on behalf of a client by means of Power of Attourney. (A Solicitor in the UK - Never give Power of Attourney to a Thai Lawyer)

I'd also have all the forms pr-completed with only final details to be finished (dates/signatures etc) and a full list of instructions to the solictor with respect to obtaining certified translations of documents.

Appoint and Executor to your Will in the UK and give him/her a list of instructions of what needs to be done to secure your Wife's pension, contact details, forms etc.

[TBWG]

Oh and don't forget your state pension. I've not looked into this fully yet, but my understanding is your wife is entitled to a UK Widow's pension when you die.

When I've looked into this I'll post more.

Hi GH

Any news re above? or have I missed it?

TBWG

[tingtong]

Just a small advice, as i am not that familiar with your pension laws.

you said:"i have a couple of pensions [ with profits]"

well, my advice, freeze a few, and insteed have some long -term life insurance investment. just as well you can adjust how they invest, and this will also make sure your wife( if you appoint her) will get the money in case of your death. No extra questions, no age difference....

let say 20 years the life-time of the insurance. still alive? you get your money, so, having the cash, got the same goal. also most of the place this being a long term investment, will have no tax at the end of term, at withdrawal.

sorry if mistaken, but i think it might be also an advise to consider, if you having multiple accounts.

[ronw]

They have a statement of Wishes and have notified me of what my wife's pension would be but all the forms and translations of them including the death certificate have to be forwarded to them after my death and they state that is the policy laid down. Their suggestion is that my wife travel to England after my death and they will then help her with the forms. A solicitor here looked at the form and said that he would not be able to help her and the British Embassy will not either. It is a Civil service pension so I don't think the Government want to pay out. Don't worry I am fighting and my wife now has aBritish National Insurance number and she has never been out of Thailand.

please tell me how you managed to obtain a British National Insurance number for your wife?

I have been looking online at many govt sites, and can find nothing to tell me how this can be done.Any information will be greatly appreciated.

[tutsiwarrior]

I have money in two pension plans in the UK, both for small amounts as I quit paying into them when I left employment...lets say one for GBP4000 and one for GBP8000. I could use the dough...how does one go about cashing them in? The pension representative folks that you communicate with naturally want to have you continue and give no useful information in this regard...some of them are actually quite nasty and advise 'all sorts of penalties and etc...'

I also got one of them UK mortgage accounts where you pay in monthly for insurance purposes then get the amount back at the end of the mortgage term (what are they called?) that I would also like to cash in...

when living abroad how does one approach the problem?

[GuestHouse]

Tutsi,

The general advice with respect to Pensions and 'Endowment Policies' is, once you've passed GO, don't Stop until you reach FINNISH.

There are two sets of penalties that will certainly reduce the money you get: Fisrtly administrative penalties, these are in the contract of the savings plans and can be severe, expect to loose anything up to 50% of your money, perhaps more.

The second penalty is you loose the taxman's contrabution - 12K you put in your pensions is going to be more like 16K of fund when you take the taxman's contribution into account.

You also loose out on benefits, not just your pension but also the insurance that comes with it.

On a more general note, I think it should be sounding a warning, if you are having to draw down on your pension payments then you perhaps need to be considering getting back into western employment.

I'm not making a personal judgement of you, but as an observation, spending pension savings to support your life now suggests serious financial problems are being stored up.

Remember the thing about pensions is, they are an income you receive when you can't support yourself because of old age. They are in truth more important than the job we have when we are young(ish) - While we are of working age, we can work, we can change jobs, we can support ourselves - When we are old, we've shot it - (as an example - A UK State Pension doesn't in itself meet the financial requirements for a Retirement Visa in Thailand).

Edited July 8, 2006 by GuestHouse