Self Administered Pensions (SSAS), Problems with? Please post opinions/experience.

By making a rule saying that creditors cannot take over ISAs.

No

Do you mean a Government type rule?

Yes

In message , Daytona writes

I understand now, I thought you meant there was some existing way of doing it!!!

Are you suggesting some sort of designation on he grounds of it being for 'post retirement use' or something?

Perhaps you can explain what you gad in mind.

"Daytona" wrote

I'm confused! - What exactly are you suggesting?? :-)

That would be a great idea. Of course the usual interest groups (the Revenue perhaps first on the list) would complain that it enables people to shield assets from a bankrupcy...

In Florida your HOUSE is such a protected asset!

In practice, this can be achieved (illegally) by placing funds in a "confidential" account. The problem with that is that regular statements/correspondence get mailed to your home address and if one of these goes astray.... The traditional solution to that is a nominee company. But then you are still left with the incoming funds being traceable to it, unless paid in in cash or some similar form.

If one is to assume that one's bank won't be ordered to turn over microfilms of cheques, it is easy enough to tell a bank or b/soc of a change of address, with the new address being a trusted friend... I don't think they require the usual utility bills in that case -yet!

Sorry, I'm being unclear what I meant was I believe there are laws in place to prevent impending bankrupts & IVAs from making payments with the intent of shielding money from this process, so someone who makes a sudden increase in payments into such a designated scheme can still be picked up and the excess removed & used to pay creditors at the administrators discretion.

I imagine its fairly easy for legislation to be passed to protect an existing, easily identifiable, savings product from creditors in the event of bankruptcy or IVA. I don't know whether there would in reality be any need for this as I imagine relatively few people are affected by this and *subsistence* government pensions/benefits could provide for such people. It could be designated only for post retirement use, as long as this didn't markedly add to the administration, perhaps by simply defining a set age.

Actually, there's probably a simpler way of handling this - simply define a set sum which increases with age which is protected. eg Age - 30 * £3,750. So bankrupts below 30 have no protection and at 70 someone would be able to protect £150,000 worth of savings or assets, which would still enable them to get a subsistence pension if they became bankrupt.

Daytona

Do you have a reference that an "increase" in payments can be rolled back in this way?

In general, only contributions made with fraudulently obtained funds can be rolled back, plus contributions made while the bankrupt-to-be knew has was trading insolvent... the obvious problem is proving when he "knew"

One could make irregular lump sum contributions only (many people do).

Interesting idea.

As you say, not many people go bankrupt. Those that do and are half clever can (especially over time) easily "set aside" some assets... A far bigger risk is getting divorced and none of these things help as just about everything is a matrimonial asset.

As I said, I believe there are laws in place; I'm not sure and have no references.

In message , Daytona writes

I understand the point you are making but I disagree with the principle. I think if somebody goes bankrupt then thetas it as far as accumulated pension funds go and I think occupational schemes should be able to sequested so that they can have some of their income, if not all, paid to creditors when the pension comes into payment. The principle works well in divorce!I

IN fact now I think about it a Trustee in Bankruptcy can get his hands on Pension dosh, in certain circs, let me come back to you on that after some research tomorrow.

I think that would unfair in the way you describe because somebody aged

105 could be allowed £1.1m! Whilst I dot agree with your suggestion, if I were to tagree then I would suggest that you would have a sum that was actuarially calculated so that there would be a mid life 'peak fund' after which a lower fund would be required to reflect reduced life expectancy.

I think it would be very difficult to say what a 'fair' and 'allowable' post income retirement should be, for some £35k would be needed, and others £7k. I suppose the supposed minimum income guarantee to pensioners gives us an idea of what the government thinks is sufficient.

I take the view that all 'general' and 'non specific' savings is generally for future use and could be construed to be for post retirement income. I hate formal pensions myself.

I would agree that pensions ought to be vulnerable to bankrupcy - if going bankrupt was always something which resulted from your own deliberate action.

But it need not do. An accident can happen, the risk may be uninsured (not everything can be insured, e.g. something your kids do) or the insurer refuses to pay, and if you live in a nice house you are a target for litigation. This can clean you out. I don't think it is fair that you should end up in the gutter as a result.

Even in a business (where most risks are visible) you can be taken for a ride by a clever conman/customer. OK, you should always limit your exposure in any business, but...

This is also known as "gold digging", for good reason. There is no logic behind PRE-marriage assets (which is what the bulk of the man's pension fund is, in many or most cases) to be treated as matrimonial assets.

I agree - there's also the problem of systemic bankruptcy affecting sole traders or any businessperson that's given personal guarantees. ie a customer goes bankrupt making one or more creditors bankrupt. This is why I'm thinking the way I'm thinking.....

Daytona

In message , John-Smith writes

I take your point, but the effect of what you are suggesting introduces degrees of bankruptcy. At the moment you are either bankrupt or you are not. The 'blame' aspect isn't relevant. Reckless or fraudulent bankruptcy is handled elsewhere.

What you appear to be suggesting is that hapless and completely innocent creditors could themselves be forced into bankruptcy because the debtor went under. Where will it end? Life is a risk.

Hmm thats interesting, do you justify that because of their time value?

I agree, but the law often takes a different view I fear.

No, I think that people should not be stripped of everything if something particularly nasty happens.

Especially as the party that drove them into bankrupcy is highly unlikely to be short of funds.

The risk in this approach is that a clever conman is able to make money out of it, but that's life. I've seen plenty of examples of it, but it does not change my overall view.

OK, depends on the ages. If they marry in their early 20s, that won't be the case. If they marry in their 40s, the woman will highly likely to have been a lot more focussed on "liquidity" (a.k.a. "commitment" :) when choosing her man, and most of his assets (not to mention his pension fund) will have accumulated long before the marriage.

There is no way to get around that except to shield assets. The problem with that (setting aside the POV that if you don't trust her why marry her... rather bogus these days with 40% divorce rate) is that one day you will get old and will need the hidden money, and if you are still with the same woman..? She will find out and go berserk, understandably.

But the high risk of divorce, together with the usually huge asset imbalance, and the much greater ease of hiding DIY investments, is what particularly makes me favour DIY investments over a personal pension.

In message , John-Smith writes

OK, so what happens to the people to whom the bankrupt owes money? They will now be penalised to a greater extent. This could force them into bankruptcy,

Most bankrupts were forced into bankrupcy by parties with plenty of money. Otherwise, I would ahve agreed with you.

In message , John-Smith writes

What an interesting statement. Any evidence? And what about the other creditors other than the rich petitioner? There is always collateral damage, and its those unsecured tiddlers that will suffer under your proposed regime.

You talk like a real bank manager :) (joke intended) Yes, I've signed more of those bank personal guarantee forms than I can remember, in years gone by...