Soldato
I'm gonna find out if my employer will match my additional contributions as that'll probably sway it along with the 40% cashback via tax. I'm happy to lock the cash away for 10-15 years.
Pension stuff
- Thread starter Diddums
- Start date
I'm gonna find out if my employer will match my additional contributions as that'll probably sway it along with the 40% cashback via tax. I'm happy to lock the cash away for 10-15 years.
Soldato
I pay 6.00% of my base salary, my company adds 9.00% of my base salary
Start Date: 1/11/2012 at age 34. I did have a previous pension worth about £6k which moved in to this one.
I am a IT team leader and when I asked some of my colleagues about their pensions and how they should look at their funds to see if they can maximise their pension contributions they all looked at me dumbfoundedly. Now I am not a pension expert at all, in fact after reading threads like this all the time I wonder if I am doing things right however I was shocked my company don't tell or have a user guide on the pension system we use. It's called Benpal and when I logged in first time it was a minefield but then I learned how to amend my funds and see what funds were doing well, growth etc. and using a % of my contribution going to higher earning funds.
I've now come to the conclusion that I need to consult my HR department and advise them they should make a guide as I can imagine a hell of a lot of employees get signed up and they then don't know what to do with their contributions
I have 10 funds setup and 6 of them are above 10% at the moment, 5 of them above 5% and only 1 in negative. I have since changed this fund now and moved it to a currently more successful one. I know that this is not always going to be so lucrative over a 5/10/20 year period but the fact I check it every quarter means I can react. Sadly my colleagues had no idea about any of this and they had 100% of their contribution added to a single fund and that was that.
Start Date: 1/11/2012 at age 34. I did have a previous pension worth about £6k which moved in to this one.
I am a IT team leader and when I asked some of my colleagues about their pensions and how they should look at their funds to see if they can maximise their pension contributions they all looked at me dumbfoundedly. Now I am not a pension expert at all, in fact after reading threads like this all the time I wonder if I am doing things right however I was shocked my company don't tell or have a user guide on the pension system we use. It's called Benpal and when I logged in first time it was a minefield but then I learned how to amend my funds and see what funds were doing well, growth etc. and using a % of my contribution going to higher earning funds.
I've now come to the conclusion that I need to consult my HR department and advise them they should make a guide as I can imagine a hell of a lot of employees get signed up and they then don't know what to do with their contributions
I have 10 funds setup and 6 of them are above 10% at the moment, 5 of them above 5% and only 1 in negative. I have since changed this fund now and moved it to a currently more successful one. I know that this is not always going to be so lucrative over a 5/10/20 year period but the fact I check it every quarter means I can react. Sadly my colleagues had no idea about any of this and they had 100% of their contribution added to a single fund and that was that.
Soldato
No! You're a young man, don't wish it away like that. You could get hit with a bus at 54 and the next thing you know the wife's sniffing it all up her nose.
Retirement or a slower paced / casual job at least to keep me going. Can’t keep this grind up for another 34 years! General strategy it is based on a “smash & grab” approach then go work at B&Q til state pension age!
Soldato
That's a cracking pot and contribution you get there!
My wife had a friend over from the UK last week and she was saying how her dad is still working because he's been self employed forever and has no pension... and her mum doesn't work! I don't know how they will manage to do a thing.
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My current job matches up to 8% which I've been maxing out for the last few years.
I'm starting a new job which only matches up to 4% however anything over that, they contribute 10% of my overpayments. I've worked out that if I contribute 10% of my salary then my new firm will contribute 4.6% and I'll continue to contribute the same amount as I currently do.
I've not seen anybody else mention that additional contributions attract an additional smaller contribution.
I'm starting a new job which only matches up to 4% however anything over that, they contribute 10% of my overpayments. I've worked out that if I contribute 10% of my salary then my new firm will contribute 4.6% and I'll continue to contribute the same amount as I currently do.
I've not seen anybody else mention that additional contributions attract an additional smaller contribution.
Soldato
Definitely something I can relate to in some way. I had 2 weeks off at Christmas and didn't work at all. First time I've had time off in 7 years where I've done that. Feel so much better for it, come back fighting etc. I think it's definitely important to do. You need to make it to retirement after all!
At our place no, the employer doesn’t contribute anything related to any additional payments. They’re called AVCs (Additional Voluntary Contributions) at our place (not sure if a standard term). I think there is still a a benefit though due to the way it is paid via salary sacrifice?? This is what I’m about to start researching.
Soldato
It will be before tax, so you get the benefit of saving the tax on your additional contributions.
Not a teacher are you?
Project Engineering / Management.
Soldato
Soldato
Also, to have that much in his pension pot at his age as a teacher would be bloody impressive
This is always tricky. Unless you need to cash, it seems a good idea to put in what you can, especially if you are on the higher rate of tax (because it then becomes more tax efficient).
Ignoring national insurance and any other deductions, if you get paid £1,000 gross at the higher rate you get £600 in your pocket. The choice is either taking the £600 now and investing / spending as you please, or taking the whole £1000 and investing that in your pension. Sure, you get taxed on your annuity but it does seem a pretty good (albeit speculative) bet to invest the £1,000!
Ignoring national insurance and any other deductions, if you get paid £1,000 gross at the higher rate you get £600 in your pocket. The choice is either taking the £600 now and investing / spending as you please, or taking the whole £1000 and investing that in your pension. Sure, you get taxed on your annuity but it does seem a pretty good (albeit speculative) bet to invest the £1,000!
Soldato
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- 22 Feb 2014
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- 2,677
Our company uses Benpal as well.
I've been paying in to the company pension since I started 6 years ago.
I picked a few investments based solely on the risk number attributed to them and nothing else, I have no idea if these are good or not to be honest.
They have all increased so I'm assuming that is good.
Soldato
That’s my point nobody from my company tells you how to set any of that up. Most people have all 100% of their contribution going to one fund. If that fund is negative then they’re actually losing their money.
I emailed HR and they said they’d look in to it.....
I emailed HR and they said they’d look in to it.....
Soldato
Mines with BenPal. I might copy one of yours as I've no idea what to choose either - so many options
Interesting that you guys using this benpal service get absolutely no advice whatsoever lol. you may as well have a SIPP and have your employer pay into that.
Some advice, and im no IFA; just someone who has done a bit of research into my own pension over recent months.
* Diversify. That doesnt mean picking a bunch of different funds, it means ensuring the underlying assets those funds invest in are diversified. It means diversified geographically (UK, US, EMEA, Japan etc) and also diversified by market sector (Energy, Banks, Healthcare, Tech etc etc). If benpal wont give you this report automatically then you can get it via trustnet if you type in what you have.
* You should have a split of assetts which are stock, bonds (gov or corp) and property. The usual generic advice is that when your younger you should have more stocks, and when older more bonds. All about risk, and when your in your 20s 30s 90-100% stocks isnt an issue.
* ETFs... dont discount basic tracker funds, rather than the managed funds on the screenshots above. 90% of the time, the managed fund performs worse than the tracker. A balance between the two is good! and trackers have significantly less fees than managed funds.
Some advice, and im no IFA; just someone who has done a bit of research into my own pension over recent months.
* Diversify. That doesnt mean picking a bunch of different funds, it means ensuring the underlying assets those funds invest in are diversified. It means diversified geographically (UK, US, EMEA, Japan etc) and also diversified by market sector (Energy, Banks, Healthcare, Tech etc etc). If benpal wont give you this report automatically then you can get it via trustnet if you type in what you have.
* You should have a split of assetts which are stock, bonds (gov or corp) and property. The usual generic advice is that when your younger you should have more stocks, and when older more bonds. All about risk, and when your in your 20s 30s 90-100% stocks isnt an issue.
* ETFs... dont discount basic tracker funds, rather than the managed funds on the screenshots above. 90% of the time, the managed fund performs worse than the tracker. A balance between the two is good! and trackers have significantly less fees than managed funds.