Pension / Saving for property?

greengiant

greengiant

greengiant

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Joined
3 Sep 2003
Posts
1,700
Tonight I've just signed the form to cancel my new personal stakeholder pension! :eek: Which will be getting sent recorded delivery first thing Monday!

Last month I noticed I had quite a bit of money sitting in my bank account, so I made an appointment with my bank to speak to their financial advisor, and I thought about transferring the excess into a new pension plan. (I had no personal pension up to that point).

However after receiving the final paperwork for the plan through the post this week, and having only 30 days cooling off period I thought more on the fact that these excess funds may actually be better stuck in a decent savings account rather than a pension.

My reasons? Well I still don't know where my place of work is getting relocated too as management seems to be throwing darts at a map of central Scotland!

The funds I would have had locked away in a pension may be best tucked away safely in a high interest savings account for my relocation / move out of parental home fund! (Not going to go into figures, but it would have been about 12-14 months rent!)


However until I know what's happening work wise (relocate or look for another job) I do feel I've made the right decision.

Life was a lot simpler when I was 10!
 
Why are you cancelling it altogether? As you say the money may well be better off sat in a savings account until you decide if you are relocating etc, and even after that it may be better put aside for a house deposit in the short term even if you don't relocate but if you have no other pension plan in place then it might be a good idea to start putting a small amount away each month insead?

These two things shouldn't necessacerily be seen as a one or the other thing but something saved for in conjunction.
 
Brum Man, I feel it's better if I put money aside into savings till I know whats happening. Once I know, then I'll be able to know how much I can set aside for pension.
 
Have to agree with brum man, even if its only £20 a month its worth getting some form of pension started, especially as you get tax relief on your contributions. May very well be worth you opting out too, but speak to an IFA first.

Fog
 
Personally I feel that pensions are very important.
I took out a personal pension rather than a company one when I was 18.
Over the years every company I've worked for has offered and paid into my personal fund.
Currently where I work they will match £to£ any contribution I make up to 5% of my salary.
So I'm paying around £120 a month and my work match this.

Even if my funds only perform at the lowest estimated return then I will be able to retire with a good lump sum and a good weekly pension.
If they perform at the estimated middle ground then I can throw in early retirement.
If they perform at the very top end of estimate then even earlier retirement maybe possible.

Check if your work would be willing to contribute to a personal pension - one you keep with you rather than your work.
 
Do both; private pension and property. It takes a bit longer, but you'll thank yourself when you hit 65.

If you can only afford one - go for property. At the very least, you'll have a roof over your head and some equity to draw on in an emergency.
 
I would say a pension fund is a must have for anyone in employment and should be started as soon as practically possible, even if you start slowly, as your personal circumstances change you can always revise your contribution later.

Consider it as a long term investment - you never know what life will bring when you are older.

But before you do anything more.....speak to an IFA:)
 
Thanks for the replies. Like I said however I feel I'd be best waiting 6 months - a year till I know what's happening job wise. Depending on where my work relocates to I may not be with my current employer when they move, so I dont' see the point in looking into starting a pension through them.
 
greengiant said:
so I dont' see the point in looking into starting a pension through them.
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That's why you should start a personal one like you were going to do ;)

The thing wih pensions is that there is always other places that the money could go, especially as you know that you can't get at until your 55, so there is always going to be reasons not to start, eg you're between jobs, can't afford it etc.... However even putting £20 aside (£25.64 with tax relief), will at least make a start.

Also, with a company pension if you have been paying in to it for less than 2 years you can usually have your benefits back as a lump sum or have the option the transfer the funds to a private one at a later date so might be worth checking with them about this too.
 
greengiant said:
Thanks for the replies. Like I said however I feel I'd be best waiting 6 months - a year till I know what's happening job wise. Depending on where my work relocates to I may not be with my current employer when they move, so I dont' see the point in looking into starting a pension through them.
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you can move your pension from empolyer to empolyer
 
Like I say, thanks for all the replies. For the moment I'm going to cancel the current scheme until I know whats happening work wise. Hopefully within 6 months to a year I'll know whats what. Then I should be in a position to get things sorted out, preferably by speaking to an independant financial advisor rather than the one tied to the bank. I don't think pensions are something you want to rush into the first scheme you look into!

Meanwhile I'll be squirrelling away as much money as I can (topped my ISA up as much as I can this tax year. Next tax year I'll top it up as much as I can).
 
greengiant said:
Meanwhile I'll be squirrelling away as much money as I can (topped my ISA up as much as I can this tax year. Next tax year I'll top it up as much as I can).
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This is a very good way of saving for your retirement, provided you have the will power to stop you dipping into it. Have a look around for a compound interest calculator to see what happens if you max out your cash isa each year over 20-30 years. But do this as well as a pension not instead, eggs in one basket and all that ;)

Fog


Who on earth is analogue??? :confused:
 
Biohazard said:
Start it asap.

Can anyone recommend a good provider? My partner doesn't have one yet, and her work does not run a pension scheme. ta
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Its not something you can simply recommend, the range of options is vast, ranging from a basic stakeholder, personal plans through to full blown SIPP's. It will depend a lot on your income, risk profile etc. Your best bet is to find a fee paying IFA, ie not a tied advisor (and I use the the word advisor loosely in this instance) or commision based advisor.

Fog
 
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