# Calling actuaries…..

So, Ritchie’s Peoples’ Pension Plan. I don’t in fact know what the outcome of this calculation would be. And I know it would take me a long time to get it wrong. So, instead, I know we’ve an actuary or two reading here. Could one or more of them do this number crunching for us?

Let’s just take Ritchie’s idea seriously for a moment. Everyone invests in bonds for their pensions. And we’ll give him decent numbers too. He’s suggested that these bonds building schools etc should carry interest rates of maybe 5%. And we’ll assume, to be kind, that inflation is on target at 2%.

So, the bonds pay 3% real.

A 40 year working life to fund a 20 year retirement. Reasonable enough, yes? Obviously, if there’s no real return on any investment then you need to save 33% of your income to fund that twenty years in retirement….assuming you want your retirement consumption to be the same as your working life consumption (ie, from income of 100 you consume 66 each working year and then get 66 each retirement year). Adding in real returns to the savings quite clearly changes this.

So, to get proper income smoothing over the lifetime, we can calculate two numbers.

1) How much of your income must you save during the working years at Ritchie’s suggested real return?

2) Alternatively, say we peg savings at 10% of income, what’s the real return those bonds must pay?

Assume that retirement fund is exhausted at time of death. I have a feeling that those numbers just don’t add up. Either 3% return means some unfeasible portion of income must be saved, or a reasonable portion saved means returns must be significantly higher.

But, as I say, I don’t actually know the result. Can someone tell us?

## 90 thoughts on “Calling actuaries…..”

1. For a 3% real return rate, I make it that you must save 20 / (1.03 ^ 40) = 6.1 times your income. So that’s clearly impossible.

If you decide to save 10% of your income each year, then you need a real return of (20 / 0.1) ^ (1 / 40) – 1 = 14%.

2. “A 40 year working life to fund a 20 year retirement. Reasonable enough, yes?”

Possibly not. I’m sure I read somewhere that as many as 1 in 4 people born now will live to be 100. Just a guess I suppose but certainly we are all living much much longer and the past is full of underestimations as to how long the (then) current generation will live to.

Say someone born today starts work at 21. I doubt it unreasonable to think he/she might live to 90. 40 years work leaves him/her 29 years of retirement.

40 years is probably long enough to save up a decent pension pot on the stock market but surely not in bonds.

Rely on Ritchie’s people’s pension and I think you’ll be working till you’re 80.

3. Why on earth would the government issue savings bonds yielding 5% when they can get away with selling 30-year bonds for just 2.5%?

Silly question, they already did issue 4% NS&I bonds to buy off the grey vote.

4. Tim, your obsession with Richard Murphy seems to be consuming you. As much as I like your writing, you’re recent blogging appears to be driven by envy – that Murphy is getting a great deal of attention in the mainstream press.

5. The following calc was done using the calculator on my iPhone (I’m on a train, so apologies if it’s inaccurate):

Assumptions:
i = 3% (assuming the fund grows at the same rate in both accumulation and decumulation periods)
Accumulation period = 40 years
Targeting an annual decumulation amount of 66 over 20 years, paid in advance, no fund remaining at the end.

This would require a contribution rate of around 13%.

Capping the contributions at 10% pushes up the required return to around 3.8%.

Of course, this is an extremely simple example and real pensions calculations are slightly more complicated (we actuaries do quite a lot of study and do get paid a lot for a reason). But I know you are only interested in the rough calcs, so that’s what I’ve given you.

This Peoples’ Pension idea is so full of holes that it could occupy me for the rest of the day. In the real world I’ve got some meetings today with real pensions and investment experts to discuss some genuine infrastructure projects that my company is looking at. But Ritchie wouldn’t be interested in my experience, would he?

6. I must be missing something, because I don’t get the ‘investment’ part of his overall argument.

How doe you get a return on building a motorway, hospital, school etc. if you are going to provide those services free of charge to the public?

Toll roads, private hospitals and schools, then yes. But I thought the point of the Curajus State was that everything should be free.

What generates the return on investment he’s promising?

7. I’m no expert, but I get the feeling if an Investment Management company offered his “People’s Pension” as a product they would be prosecuted.

8. @stuck-record.. What generates the return on investment he’s promising?

Silly boy, the MMT* of course!

* (M)agic (M)oney (T)ree.

9. The old saw has it that being an Actuary is the business for those who found accountancy too exciting.

Trying to discredit Murph –and Corbyn(e)? Two of Britain’s most dangerous (and unwanted) seniles? That must be putting a letter opener to the envelope of fear for those lads.

10. If Ritchie’s proposing stealing my pension to go in to his bonds to pay for stuff my taxes already pay for does that mean we get a corresponding tax cut?

OK, that was rhetorical but the point stands that we already pay for this stuff through taxes that give us a state pension and other benefits along the way such as health care and education, albeit not the same amount. Doing it this way avoids all the complications about guaranteeing returns which will have to be picked up by future tax payers.

11. Pogo.

Quite.

But what does HE think provides the return on investment?

How are they going to sell this to pension fund managers – other than at the point of a gun?

12. I think Stuck Record has it – and Andrew M’s question stands to be answered as well.

Government is currently borrowing at far cheaper rates than would be offered by the ‘People’s Pension’. The funds would be invested in projects that produced no yield, by design!

Even one of his contributers has asked him why, if this is what he wants, the government doesn’t just offer up a tax-funded defined benefit scheme.

13. PT

Tim can answer for himself, but I think you are being unfair. For Tim, Murphy is an easy target – it’s like shooting fish in a barrel. And IMO, the more attention Murphy gets in the MSM, the more he deserves to be targeted.

14. This is a man referred to in the media, in established broadsheet papers, as an “economics expert”. It’s completely staggering.

15. A 3% real return makes pension saving no problem.
The problem with pension savings currently is that real yield on index-linked gilts are -1%.
So Murphy proposes that the yield on his bonds should be 4% higher than on gilts. Coupons on conventional gilts are roughly 4%,(unweighted average of those listed in today’s FT is 3.875%) so he wants to *more than double* the amount of interest paid by HMG to investors.

16. PT

You know how, like, people in the Victorian era would take a day trip to Bedlam to laugh at the afflicted? Well that’s us with Murphy.
You don’t think it’s reflects well on us? Well I like me, so…

17. My quick calculation is that if you want the same net income before and after retirement the rate is 16.5% giving a pension of 83.5% of pre-retirement nominal income.
Most pension calculations start off with “two-thirds of pre-retirement income in retirement”, in which case you get GlenDorran’s 13%

18. PT,

Its not just that Tim picks up that Murphy is wrong he explains why he is wrong, which is an education in itself for those who haven’t done an economics degree. With a bit of luck some of the more broadminded MSM may pick up why its wrong and start to point out the emperor’s lack of clothes.

Furthermore there are some knowledgeable contributors who had to the overall knowledge transfer.

19. john77:

Indeed, the key point is the real return.

Interestingly, on many of the infrastructure projects I’ve been seeing the yield is getting squeezed further, so it is actually a good time to get cheap funding.

Ritchie’s “plans” just don’t make sense on so many levels. To be expected, given he has absolutely no experience in this field whatsoever.

Is there any topic on which he would listen to experts?

20. @ GlenDorran
Given that his wife, a GP, is on long-term sick leave ….

21. @john77
“A 3% real return makes pension saving no problem.
The problem with pension savings currently is that real yield on index-linked gilts are -1%. etc”

Isn’t this some version of the Worstall Fallacy?
The -1% effective yield is the result of the kosher QE that’s current policy. Not what interest rates would be without it. PQE would, presumably, be setting market interest rates at whatever suited Murphy’s purposes.

22. Come to think of it, as PQE is effectively printing money, would have thought interest rates of a thousand percent would be easily attainable. Along with effective yields of minus 10,000 percent, of course.

23. I’ve often wondered why the likes of Stephen Hawking waste so much of their time, when they could be asking Murphy to reconcile general relativity and quantum mechanics and summarise the equations on a large post it note, all in the time it takes to order and consume a large latte at Starbucks, and still leaving him enough time to castigate the manager about the company’s tax avoidance arrangements.

24. As I looked out at the rain this morning three things occurred to me.

Firstly, did it rain as heavily in the 1970s before neoliberalism destroyed the ozone layer?

Secondly, would a People’s weather forecasting service not make sense? An office of weather responsibility would oversee it and I would be it’s King.

Thirdly, I invented what is now called sunshine but which I previously called “what shines out of my arse”.

25. Stuck – record

I don’t think he has a clue about what the generates return – my gues is if challenged he will either resort to calling the critic a troill or neoliberal. However, it’s just possible he might think ‘People’s QE’ can be used to an unlimited extent to provide the return on investment as well. It’s the Gideon Gono school of economics revisited.

I’ll say it again – one of the most dangerous men in Britain….

26. I don’t know about the situation in UK, but here in the USA, taxes on retires are significantly reduced.

My pension and Sociable Security give me a gross income that is \$1000/mo less than what I got what I was working. But my after tax income is \$1000/mo more than when I was working.

Secondly, bonds is dumb for long term savings. Put your long term money in equities.

27. Gamecock:

Yep, equities best bet for long term real returns. Ritchie also doesn’t appear to understand the concept of diversification.

Although if you are planning to purchase an annuity with your fund then a gradual shift into gilts as you approach retirement makes sense as you want to match out your exposure to changes in yield.

Amazingly enough, the market has already thought of this and every single pension provider offers “Lifestyle” funds that do this automatically.

28. BraveFart:

I’ve got more than two decades of experience in the savings industry, yet i would not come close to being described as an expert but I speak to genuine experts every day, attend conferences, read papers and actually have practical experience of all the things Ritchie is rabbiting on about.

john77 has even more experience than me (and from what I’ve read from him, he would be described by as a “wise old head”; someone that the younger actuaries turn to for advice).

But somehow our knowledge is to be disregarded by Ritchie, our experience ignored and our criticisms denounced in his favour.

Truly an arrogant, ignorant prick.

29. GlenDorran

It’s a shame for people like you and me. I’m what I think most would describe as a tax expert, with the same length of experience as Murphy.

However, what I can’t compete with is the number of epiphanies the man experiences. Every time he has a bath you can imagine him shouting Eureka as another insoluble problem is solved.

30. “What does he propose for the unfunded Public Sector pension lot?”

If he would just grasp the nettle and advocate scrapping the damn things then people here might form a higher opinion of him. But unions are his paymasters, aren’t they?

31. And presumably that 16.5% deduction level will need to be higher if we assume that people will gain experience (ie get promoted) / earn more later in their careers – and will then want their retirement income to be pro rata to their later years of earnings? Ie, it skews contribution levels to later, hence larger % contributions needed?

Hence, if salary growth (promotions) was anticipated to be 5% per annum, same as investment returns, then you’d be back to 33% deductions? Ignoring tax incentives.

32. Oh, meant to say Gamecock:

Pensions in the UK count as taxable income so don’t attract any special reliefs (other than being able to take 25% of your fund tax-free on retirement as a lump sum).

Part of the issue that Ritchie et al have with the higher rate of tax relief is that a lot of people move from being higher rate taxpayers during work to the lower rate when they take their income. They view this as unfair.

There are arguments to be had about pension tax relief. Unfortunately Ritchie hasn’t been able to make them.

33. “As much as I like your writing, you’re recent blogging appears to be driven by envy – that Murphy is getting a great deal of attention in the mainstream press.”

Very good! That’s what I like about this place – most people have got a pretty good sense of humour..:)

34. PT,

Its not just that Tim picks up that Murphy is wrong he explains why he is wrong, which is an education in itself for those who haven’t done an economics degree.
—————————–

And the fucking idiots who would otherwise elect him, be thankful. very very thankful, we have people calling his dangerous ideas out

35. @PF: yes, need to take that into account once inflation/salary growth are factored in.

That’s a big part of why so many final
salary schemes are rooked. Small contributions throughout the career, then retire when you are at your highest salary, without the funding being in place to meet the resulting pension.

As a junior trainee working on final salary scheme valuations I saw many examples of senior employees being awarded big rises shortly before retirement in order to boost their pension. Apparently it’s particularly bad in the public sector, but I’ve never worked on those schemes so take that as an anecdote.

36. “What does he propose for the unfunded Public Sector pension lot?”

People’s QE, of course!

37. He would dismiss expert industry opinion rubbishing his efforts and smear it as “lobbying”, probably a ‘neoliberal industry conspiracy’.

38. @Rob: right on cue….

“@RichardJMurphy: @DavidPenney10 @JohnRalfe1 You are both heavily invested in the status quo. Now explain why it works when the evidence is to the contrary”

39. His funding by the PCS, TUC gives him the knowledge and understanding to comment impartially on important matters.

My employment in the pensions industry means that all my comments are designed to ensure that I continue to extract rent and thus should be ignored.

40. “My employment in the pensions industry means that all my comments are designed to ensure that I continue to extract rent and thus should be ignored.”

And yet he is somehow uninfluenced by the (politicised) sources of his funding.

Obviously.

41. @GlenDorran
“I saw many examples of senior employees being awarded big rises shortly before retirement in order to boost their pension. Apparently it’s particularly bad in the public sector, but I’ve never worked on those schemes so take that as an anecdote.”

When I as in HMIT (as was, now HMRC) the usual pre-retirement trick was for senior people to be posted to London for the final few years. Their final salary was therefore influenced by the London weighting, thus boosting their pension for the next 20 odd years at the cost of the inconvenience of a couple of years working in London.

42. I am an unbiased observer of truth.

You have conflicts of interest.

He is rent seeker.

43. It’s worth spending time debunking Murphy because his economic policies—and his political ones, for that matter—are fascism, pure and simple. Just compare Hitler’s initial economic programme with the Murphy-inspired Corbynomics: they are, essentially, the same.

In this country, we have a proud history of fighting fascists: but we cannot win unless we actually fight Murphy and his Fascist… sorry, Curajus State.

DK

44. @DK

There’s gotta be a blog in there- comparing the post Weimar german political economy with what Murphy is proposing

45. “Pensions in the UK count as taxable income so don’t attract any special reliefs”

Same here. Because of my lower income, I am charged a lower rate for income tax.

Other changes for retirees:

I pay no state income tax on Sociable Security.

My state gives me a \$15,000 deduction on my income tax because I survived to age 65.

I don’t have SS/Medicare deduction anymore. My medical insurance deduction has been replaced with Medicare B deduction, which is less.

Generally, lower taxes and fewer deductions. I heard some years ago that as a (U.S.) retiree you need about 60% of your working income to get about the same money as while working. My experience is that is about right.

46. “My state gives me a \$15,000 deduction on my income tax because I survived to age 65.”

That’s different to the UK. Broadly, allowances are unchanged for pensioners.

Pensioners don’t pay NI (analogous to Medicare deductions)

47. AndrewC

Oh FFS!

Still there is one appealing prospect about the publication of “the Joy of Tax”, which is that the references everywhere to the “Courageous State” will probably diminish.

48. AndrewC

Timmy’d better block the first week of October then.

I’ll be spending September making all the popcorn.

49. Your question seems to assume a constant income over one’s career. Whereas, with a bit of progression, one’s income should go up steadily in real terms. Unfortunately the most advantageous time to invest is at the point where one has the least money to do so.

50. BraveFart

I think when you look back at the blog entries from the ‘Curajus State’ era then Murphy seemed significantly less thuggish than he does now – My Guess is ‘The joy of tax’ will be an even bigger treat than the Courageous state was!

51. VP

Someone here should read The Joy of Tax and report back with an objective review. Someone with time on their hands and a more than passing interest. Is there such a person I ask myself 🙂

52. There should be a debate on public sector pensions, but perhaps we should keep up to day with the facts. They have for the ostrich part moved from being final salary based to being career average salary based. So the last-three-year salary increase scam has ended forever. Also the newest incarnation only for drawing the full pension at the same age the state pension can be drawn. The terms are far less ‘gold-plated’ than they used to be.

53. There is, sadly, an important error in the original calculation, which is that you need the same gross income on retirement as before. You twigged that you won’t be paying the pension contribution, but you failed to take into account that at normal pension age you stop paying NI. Also, you don’t need to commute to work and/or meet costs associated with being away from home, e.g. lunch. Many people will lose their highest rate of tax. For some, retirement will coincide with paying off a mortgage, and housing costs will plummet.

How do I know this? I retired, and am now better off than I was working, on half the gross.

54. Glendorran at 12.45pm

I would have thought any issues of fairness or higher rate taxpayers getting an unfair advantage were sorted forever by limited the size of the pot and the annual limits for contributions… apparently not.

My calculation assumed a post-retirement income of 2/3 of salary, based on Tim’s original request. This is reasonable as the most common final salary schemes provided this income for 40 years of contributions.

56. @Ironman

I agree public sector pensions are not as wildly generous as they used to be.

They are still far, far better than anything generally available in the private sector.

The gold plating may not be as thick but it is still there.

I’m not complaining, I have 10 years accumulated when the gold was armour plating thick (1987-97)

57. @ GlenDorran
Flattery is for emperors, not for the likes of me – I have always been clever but never (well perhaps very occasionally) wise. I even noticed the difference as a pre-teen (that *I* could notice that I was less wise than my friend William who was not quite as clever speaks volumes).
Agreed that after a bit over four decades in investment after three *years* in actuarial work I’ve certainly got more experience than youngsters like you, but you still know far more about it than 90+% of the population, let alone Murphy.

58. “ss or higher rate taxpayers getting an unfair advantage were sorted forever by limited the size of the pot and the annual limits for contributions… apparently not.”

Funny thing is, if income tax were not progressive there wouldn’t be this supposed unfair advantage.

But I don’t think the LHTD would accept as an argument that a flat tax (with or without tax-free allowance) would resolve this “fairness” problem……..

59. “assuming you want your retirement consumption to be the same as your working life consumption ”

Bad assumption, I think. Typically, working-age people require larger housing with space to raise children, and have the expenses associated with raising and educating children.

Typically, people do not retire until their children are no longer a cost.

60. “Bad assumption, I think. Typically, working-age people require larger housing with space to raise children, and have the expenses associated with raising and educating children.

Typically, people do not retire until their children are no longer a cost.”

Assuming nothing changes in the plan, my housing costs in retirement will be 1/4 what they are now.

Do not complain at GlenDorran if you do not like the question that Tim asked. GlenDorran is NOT responsible for Murphy.
I am semi-retired and I noted the saving from the absence of self-employed NI Contributions when I hit 65 and continue to note that it costs less in money since I only cost is a bane since it comes out of post-tax income.
These are the two most common reasons why the target rate of pension was, when I was young many years ago, set at two-thirds of pre-retirement income; the third *should* be ceasing making pension contributions; fourth, for many but not all, the extinguishment of mortgage repayments (my last moretgage ended when I was 52); the impact of progressive tax rates is a fifrth.

62. Oh, *** – that should read “… in money terms since I only have to commute into London when I have to attend a meeting but the saving in time and hassle is much more important commuting costs are, for employees, a bane…”

Yes, we can argue about the targeted retirement income, but the contribution rate I quoted above can simply be scaled.

However, as pointed out by various people, one of the key points is the expected real return from Ritchie’s plans against the actual returns seen in the market.

There are many reasons why his ideas on pensions don’t stack up. This is just one of them.

64. Reading this thread makes me wish I was retired. Then I could spend time understanding all this stuff better, and generally addressing the points that really bother me*

* chiefly: why am I the only person who prefers Elementary to Sherlock? Miller does the best ever interpretation of Holmes and no one cares, but Cumberdick Bendybatch wears a coat and has floppy hair and the entire planet has a fit. WTF

65. @ Mr Ecks
That is a joke, and not a very good one.
I could cope with excitement, it’s the lack of intellectual rigour with which I cannot cope.
Many years ago my school had an “inter-house” boxing competition; in my first two years I was beaten in the first round by a superior boxer; the next two years, I won; in my last year there were just two of us in my weight and I asked “do we *have* to do this?” – I was over-ruled so I knocked him out of the ring in the first round. Dealing with Murphy is the intellectual equivalent of my last school bout.
It is indeed painful, but not at all exciting.

66. @ John Square
I cannot believe that you are the only one – I have never seen “Elementary” but my wife’s comments on “Sherlock” (she has read the original Conan Doyle stories and watched the excellent Granada Holmes) implies that there are potentially myriad better alternatives.

67. John Square:

I keep meaning to watch Elementary.

I think Sherlock is very good, but Cumberbatch isn’t the best thing in it – that would be Mark Gatiss as Mycroft.

68. @ b(n)is
It cannot be a version of the Worstall Fallacy since it predates his birth by a century.
To address your serious point – Murphy wants to reduce “real” returns in order to transfer wealth from those who have earned or inherited it to HMRC employees, himself, and other beneficiaries or “The Courageous State”. So his policies would reduce all pensioners (except those who, like him, had massive subventions from public sector unions and such like) to starvation.

69. @ Ironman
I do not laugh at Murphy – he is more likely to make me cry.

70. @John 77 “in my last year there were just two of us in my weight and I asked “do we *have* to do this?” – I was over-ruled so I knocked him out of the ring in the first round”

Somewhere in my loft is a large impressive trophy saying I was the Southern Region Civil Service chess champion in 19wheneveritwas. Only 5 people entered and three of them could barely play chess having only entered to get a day off work and attend the sports day where the event was held. I drew my game with the only other regular player and when I asked if we should play another game to decide the winner he just said “Nah, I won it last year, it’s yours).

71. @ Ironman
That is a welcome improvement but all those approaching retirement still get, in full, the ridiculously generous final salary-based benefits.
My wife, a social worker, will lose more from the switch to average salary despite the higher accrual rate, because her promotion was after the cut-off date. This is something she puts up with because she chose the job for ethical rather than financial reasons (she has a Cambridge degree). We nevertheless support the change because it is fairer, reducing the subsidy to the “top brass” who get promotions or ransfers to London shortly before retirement at the expense of the majority who plug away at doinmg their job rather than manipulating the system.

72. @ Andrew C
I was not trying to boast – in my best 3km in the last couple of years I was double-lapped by a really nice youngster (he habitually laps me and says “don’t move out to let me pass, I’ll steer round you” at the cost of a second to his time).
My point was that I did not want a bout that was totally unnecssary* and unexciting. I did not expect him to fall through the ropes out of the ring but I did not expect him to last two rounds, so it was not exciting. I *did* want a bout to be exciting – what the hell is the point of a bout that is not exciting?
Aka I did not want to hurt someone unnecessarily

73. @ GlenDorran
Yes, Mark Gatiss’s “Mycroft” is good but that is partly because Mark Gatiss co-writes the show.
In “Sherlock” Cumberbatch’s personality is a misogynistic shit which is utterly different from from Conan Doyle’s character who treated ladies in a gentlemanly fashion while being, himself, asexual.

74. @John77

I didn’t think you were boasting, sorry if my response made you think that.

My thoughts were that Murphy is champion of loony tax and economics exponents because there are so few such people.

75. I read somewhere that the two characters played by the highest number of different actors were Sherlock Holmes and Jesus.

Even if it isn’t true it’s a good dinner table game to see how many different actors you can remember…..

76. “why am I the only person who prefers Elementary to Sherlock? Miller does the best ever interpretation of Holmes and no one cares”

Jeremy Brett. I win.

77. Rob,

I like Jeremy Brett, and I’ve got all his Holmes on DVD, but it’s just an update of Rathbone. It’s very good, but not original.

Jonny Lee Miller is (astonishingly) the best modern Holmes, and not by a small distance. All the ingredients of a classic Holmes (violin, drugs, unusual sexual attitudes) but served up in an original and believable way.

Cumberbatch (and Cumberbitches) be damned- Elementary every time.

78. @ Rob
Yes, Jeremy Brett was brilliant
Who was Miller?
Presumably not an Actuary

79. Yay!

Elementary over Cumberbatch by a very long way. Miller produces an interpretation of Holmes that for the modern setting, possibly surpasses Jeremy Brett’s.

If I remember correctly, the other half caught about 30 minutes of an episode of Sherlock, I wandered in for the last ten. The whole thing seemed to be utterly predictable on every level, down to choice of camera shots.

80. Just to add to what’s already been posted (better late than never)

Making the following assumptions:
Investment growth =5% (= 3% real rate)
Inflation = 2%
Salary growth = inflation + 0.5%
Pre-retriement period = 40 years
Annuity cost based on single life, level annuity, no guarantee (Hargrave Landsdown best buy) = £5,850 at age 65 (£100k premium)
Single life, RPI escalation, 5-year guarantee = £3,320 at age 65.

On this basis, someone would need to invest 16% of salary to achieve a 2/3rds level pension and 28% to achieve the 2/3rds pension escalating at RPI.

As explained above, 30-year index-linked gilts are currently producing a real return of -0.8%, up from -0.9% this time last week!

81. Another set of assumptions:
Salary flat in terms of inflation.
Want the same standard of living throughout life.
40 years income, 20 years living off savings
3% real rate of return.

You’d need to save 16.5% of your income for 40 years.

With a 0.5% compounding annual pay rise, you could live off 90% of the initial salary (but your pay rises wouldn’t give you any improvement in your standard of living; they’d entirely go into savings).

If you want to improve your standard of living at the same rate as salary and then live at the same standard of living as your final salaried year through retirement, you need to save 18% of your salary.

If you want to save a fixed percentage each year, and then live off 2/3 of your final salary after retirement, then you’d need to save 14.8% of your annual income.

On 10% savings, 0.5% annual real pay rise, living off 2/3 of final salary after retirement, you need 4.23% rate of return. Without the pay rises, you’d only need 3.85%.

82. @John Square

To echo Fen Tiger – you’re definitely not alone.

Miller gives a fantastic performance as a ‘different’ person – even down to the way he moves and his posture.

Sherlock is like an iPad – bland and predictable with a well designed skin

Miller has soul

83. John Square,

Elementary wipes the floor with Sherlock. Everyone was raving about how incredible Sherlock is, so I gave it a try. It’s so bad it’s embarrassing.

Cumberbatch’s Holmes is like Blackadder: unbearably smug and self-satisfied, so you’re supposed to laugh as he insults someone yet again. Which works in a sarcastic sit-com, but doesn’t make for a profound character.

Miller’s Holmes struggles with his knowledge that better people skills could make him a better investigator, so he insults people brilliantly yet also hates himself for not being able to stop doing so. Miller was born to play Holmes. Hard to see how it could be done better.

And kudos to the writers, of course.

And let’s not get started on having clues literally glow and jump out of the screen as Holmes sees them. May as well have just had Cumberbatch do an echoey voiceover saying “Aha! A clue!”

84. I feel like I’ve accidentally held a big coming out party in this thread.

Apologies for the derailment (and the way Mr Gadsen’s excellent contribution has been lost in the Holmes comments), but damnit- it feels good to know I’m not alone.