Me and my pension
Pensions World (ghost-written)
(Written for Chrissie Maher, founder director of Plain English Campaign.)
I did consider starting this piece by boasting that I have been aware of pensions for more than 40 years now. Unfortunately the first 30 odd years of that awareness consisted solely of a brief conversation while I was sewing bras in a Liverpool factory in 1959!
We were paid a halfpenny for every 400 pieces that we sewed so when I started, and needed the money desperately, I raced ahead of the other girls. Sadly, I started earning too much for the management's liking and they threatened to increase the targets. The older (and tougher) workers hit the roof and the supervisor told me to slow down because she couldn't afford to get involved in industrial action. The reason? She didn't want to risk losing her pension.
Of course that was irrelevant to me (though I did slow down to avoid a black eye). But it says a lot about what pensions meant to me and my colleagues. They were only for the rich people and not for the likes of us.
My first job had been with the London and Manchester Assurance company and every penny I earned went straight to my mum to help feed and clothe my brothers and me. My long term savings strategy consisted of washing the manager's car ever-, Saturday morning until I could afford a pair of stockings. Nobody told me you needed suspenders as well to keep them up!
The rest of my employment history involved the Prudential, an advertising agency and a biscuit factory, where the nearest we got to employee benefits was the chance to buy cheap broken biscuits. A pension was what the Government gave you when you were old in return for paying your national insurance stamps. I never really thought about pensions after the bra factory; between then and launching Plain English Campaign in 1979 I was more concerned with being a mother and a professional troublemaker!
Before you start to wonder why this isn't called `Me and my lack of pension', let me say I did finally take the plunge a few years back and start putting money into a personal pension. I'm not quite sure which was the more important cause: realising just how little the state pension is, or the idea of keeping some of in,,, cash out of the hands of Hector. I think it may be the latter, as there have certainly been a few times when I've wanted to kick that particular taxman for his lack of clarity.
The worrying thing is that I couldn't tell you off the top of my head any details of the scheme that I joined. On the one hand the work Plain English Campaign has done on pensions has given me a better idea of what is involved. On the other hand, I now realise just how little the majority of people know about our pension system - and how scary the things are that you find out.
Just to give you one example, very few people outside the industry are even aware of the concept of annuities. As far as I was concerned when I joined the pension scheme, you simply paid in your money and when you retired the pension firm sent you some money back each month. To find out that you have to take your chances with the state of the economy when you buy your annuity is bad enough. Then to find out you could die a few years after you buy your annuity and have all your pension savings just wiped out is terrifying. Then again, you could do what I intend to do and live to 100!
But that's a lesson I've had to learn. So here I am at 63, collecting a pension from the state while continuing to pay into a private scheme (and don't even ask me to explain how that makes sense). I thought that was the last I'd have to hear about the `p' word. And then came stakeholder.
Boobs and blunders
The pensions world is hardly known as a barrel of laughs, but I must admit the experience of pension firms using pages of waffle to try to sell themselves as Plain English Campaign's nominated scheme was better than most TV sitcoms. I'll be honest- it has saved us a lot of work when looking for candidates for our Golden Bull booby prizes in December!
But, as an employer, it's a scary situation. Even though the firm isn't technically responsible for the scheme, you want a good deal for your staff. Our youngest employees are about the same age as l was back in the bra factory. Thinking how much the world of pensions has changed since then, I can't imagine how things will be when they reach retirement age.
I don't think we can ever stop pension decisions being a long term gamble, but the least we can do is put the formbook in plain English so future Chrissies can make an informed choice.