Pension

[beh]

I would be looking to put away £100 a month until I retire.

If you're unsure just stick it in an ISA for now to retain flexibility, no great rush, you can always move it into a SIPP or whatever at some point in the future.

 

[borich_planner]

Final Salary pension here, Do you think its also worth opening a private pension or just stick the money in ISA or stocks?

Borich

 

[titchard]

Just had a look at your flickr... You've had a baby recently, you must be one young and virile 65 year old.

...you don't have to be 65 to consider starting a pension.

For someone with the username "Intuitiveness" you really don't live up to it.

Rich

 

[Xordium]

Might want to consider starting a pension for the little one at the same time. If you start when they are very little you can get them well on the way to having a decent pension pot without breaking the bank.

 

[philjohn]

With a stakeholder pension you also get tax relief on the money you put in there, CBA to do the maths, but if you, for example, paid £80 in it gets bumped up to £100 (or so).

 

[Skiddley]

Lots of advice, thank you.

You asked how old I am. Well, I am 34, married with a child. My wife has a large pension that she has paid into for years and with a substantial amount. I just thought it about time to start something myself and act as a top up to monies saves elsewhere. I would be looking to put away £100 a month until I retire.

Before you decide on an amount, do some projections that will calculate conservative income at retirement on 100p/m invested. It won't be much .

My employer is matching my contributions of 6%, and I'm thinking that is woefully inadequate

 

[Blackbadger]

Pensions are risky, historically many have lost out big time, as companys go under, invest your money in risky schemes, whilst paying themselfs millions.

If however your a civil servent pensions are excellent, and one of the few secure ones.

Also state pensions may not exist in 30 years time, regardless of what contributions etc you pay today. The money is not currently invested but used to payout existing retired people. So it would not be wise to rely on that.

 

[LiE]

My employer allows me to pay 5% of my wages into a pension and they will match it + 2%. So a total of 12%. Is this 12% on the before tax amount? and is it worth it?

 

[DominicStar]

Yes it will be before tax and you won't pay any tax on the amount of deductions, unless you earn an obscene amount. You will still pay NI on it though.

As to whether it is worth it, you should decide that based on independent advice, given as it's illegal to provide any advice whatsoever on pension without a licence.

 

[LiE]

Right, it works out pretty decent then at about £350 a month, of which £145 I contribute.

 

[randomshenans]

I have a final salary pension here as well, but I'm considering spreading out my investments and say putting £50 in to an ISA and £50 to Premium Bonds each month. Not a huge amount but it'll all start to mount up and when I stop earning slaves wages can up the amount too.

The cash under the matress thing would only work if you buy foreign currencies. If you had some money in €'s before the downturn you'd have made c.30% on your fund.

 

[dirtydog]

Also state pensions may not exist in 30 years time, regardless of what contributions etc you pay today. The money is not currently invested but used to payout existing retired people. So it would not be wise to rely on that.

State pensions aren't going anywhere. No British government will let pensioners starve to death on the streets, or go homeless. What would not be wise, would be to invest in a private pension if, upon retirement, you simply get less overall, due to state benefits, than you would have done had you invested nothing.

 

[stoofa]

I'm happy enough with my pension and it's projections - even at it's lowest rate.

I started my pension when I was 17, paying in £50 per month and my employer matching it.
I now pay £150 per month and my current employer matches this.

I haven't paid in for every single year since I was 17, but only a few years when I was either out of work or on short-term contracts did I miss payments.

I have projections at high, medium and low returns (remember the current low returns will be a small blip on the whole length of the pension).
I should be able to retire early - which is something I really want to do as I saw my dad die at 60, working all his life and not getting to enjoy retirement.