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Pensions
- Thread starter Napper
- Start date
nail-Z
Well-known member
If a company is matching your contribution it must be worth doing, IMO, as contributions are also pre-tax.
With an ISA it's a bit too easy to dip in to.
With an ISA it's a bit too easy to dip in to.
D
Deleted member 18477
Guest
If you are only starting a private pension and you're already 40 then yes £200+ a month seems about right.
Takes a lot to catch up if you don't start early 20's.
Takes a lot to catch up if you don't start early 20's.
beorhthelm
A. Virgo, Football Genius
- Jul 21, 2003
- 35,310
where on earth would give that advice? you have a lot to catch up and anything is better than nothing.
vs ISA, the short version is you get income tax relief on pension contributions, so 20% on top of what you put in. pay in £100 you get £120 in the pension.
This.
If contributions are matched, you are doubling your money right off the bat (not to mention not paying the tax on it). You'd have to have some inside info on a guaranteed way to more than double your money to make going for an ISA worthwhile...
... and when you get to the end you can get 25% of your fund in a tax free lump sum (assumes Gov't don't close that down!)
kingcole
Well-known member
Anything is better than nothing.
You are getting free money from your employer and could be worth a load more in you hit 40% tax, but still a nice saving at 20% tax.
You are getting free money from your employer and could be worth a load more in you hit 40% tax, but still a nice saving at 20% tax.
KZNSeagull
Well-known member
Always worthwhile doing, but it depends if you are likely to have a dramatic lifestyle change (lose your job, for example) as you cannot touch your pension fund until you retire. If you are due a large redundancy payout, if the worst came to the worst, then paying into a pension should be fine.
Lord Bracknell
On fire
A decent pension pot will, at least, give you an option when you reach the age of sixty-something and have to decide whether you have an alternative to carrying on working full-time.
This is a question only you can answer.
- Thread starter
- #12
yes understand this.
Not sure what option a not very good pension will give me.
- Thread starter
- #13
yes , minefield though as advice always biased and online hazy
Get out clause is mortgage will be paid and possible inheritance.
Lord Bracknell
On fire
Probably none. Although you might strike lucky and qualify for lots of state-funded benefits, assuming British politics has done a U-turn by then. Or the economy has been boosted by the discovery of massive gold reserves, buried under the South Downs.
kingcole
Well-known member
If OP is 40 and intends to retire at 65 and assuming is is a basic rate tax payer, then his £200 will only cost him £160 plus £200 from the company. That equates to £72,000 in contributions by the time OP is 65. If the fund performs well, then the value may well reach £200k.
That would entitle the OP to a cash free lump sum of £50k and an annuity of about £9000pa. This could be increased with the new drawdown facility.
Also, current legislation entitles you to take the pension from 55, so not being tied up for too long
- Thread starter
- #16
Nice one.
So half of this ie £80 would give me 25k and 4.5k a year . Factor in state pension whatever thats worth ? and maybe no mortgage to pay etc then that would be worth it