O/T Pensions, I am lost

[crashbang]

Anyone in this field, I am not bothered about putting figures up, but what I save and what I get back seems pathetic.

[shiregreenmillers]

Anyone in this field, I am not bothered about putting figures up, but what I save and what I get back seems pathetic.What are you bothered for crash with all the property you got..How much do you get a month ...:s :s

[rich76]

It will sound like a cliche but each individual's circumstances are different. Primary considerations are taxpayer status and age for me. The amount you want to stick in a pension is a consideration too; don't put 50 a month in and think you will get tens of thousands per year in retirement.

Sticking my neck out, and especially for basic rate taxpayers, I prefer ISAs to pensions. They are not as tax efficient but you have full control over your money and it isn't drip fed back to you in retirement.

Having said all that, if you are offered an employment scheme to which your company will contribute, do it. It's free money.

If you want a chat about it, drop me your email.

[Heman]

My experience of pensions is that they are a bit like a lottery. My father in law lost the will to go to work soon after his car was washed away in the 2007 floods so he retired. He got a good pension - 3 in fact. If he had stayed on for 1 more year he would have hit the financial meltdown in 2008. He would still be working now as his pensions would not have recovered yet.

Put it in property is my opinion.

[Galant]

Rich - ISAs are just as tax efficient for 20% tax payers in most circumstances and you have instant access if an emergency occurs.
40% tax payers are better off with pensions.
Another main advantage of company schemes is that the company usually contributes as well as you and often more than you i.e. free cash.
If you are over 40 and don't earn a lot - forget it it's too late - live it up whilst you can.
Under 40 put as much into ISAs and pensions as you can without making your life a living misery - that's my advice.
Started my first pension at 19 and started taking it in my early 50's - glad I paid in - can't wait for 55 to get my next pension - meanwhile the ISAs are racking up interest and the property portfolio is increasing in value again - lovely jubly!!

[shiregreenmillers]

Galant i have got ten grand in premium bonds i won £500 pounds on them last year ..Would it be better to put the money into something else..

[Galant]

You had a good year there shiregreen - 5% return and tax free and safe as the government - well done.
However the typical payout on premium bonds is 1.3% and on average you would only expect to win £130 from £10,000 invested. This equates to 1.625% before tax.
I would suggest that (if you are prepared to tie up your money you can get up to 3.5% tax free in a cash ISA - you could put £5,000 in before the end of March and another £5,000 in April (the new tax year). You may have to tie it up for 3 to 5 years to get this but it will be beating inflation - a good idea if you don't need the money in the near term.
When I sort out my next ISA will try to remember to post my choice on here and you can decide what you want to do.
Google search - best ISA rates will get you started or Saturday's Daily telegraph has tables in it.

[shiregreenmillers]

You had a good year there shiregreen - 5% return and tax free and safe as the government - well done.
However the typical payout on premium bonds is 1.3% and on average you would only expect to win £130 from £10,000 invested. This equates to 1.625% before tax.
I would suggest that (if you are prepared to tie up your money you can get up to 3.5% tax free in a cash ISA - you could put £5,000 in before the end of March and another £5,000 in April (the new tax year). You may have to tie it up for 3 to 5 years to get this but it will be beating inflation - a good idea if you don't need the money in the near term.
When I sort out my next ISA will try to remember to post my choice on here and you can decide what you want to do.
Google search - best ISA rates will get you started or Saturday's Daily telegraph has tables in it. Thanks for that..

[clarkey1974]

You had a good year there shiregreen - 5% return and tax free and safe as the government - well done.
However the typical payout on premium bonds is 1.3% and on average you would only expect to win £130 from £10,000 invested. This equates to 1.625% before tax.
I would suggest that (if you are prepared to tie up your money you can get up to 3.5% tax free in a cash ISA - you could put £5,000 in before the end of March and another £5,000 in April (the new tax year). You may have to tie it up for 3 to 5 years to get this but it will be beating inflation - a good idea if you don't need the money in the near term.
When I sort out my next ISA will try to remember to post my choice on here and you can decide what you want to do.
Google search - best ISA rates will get you started or Saturday's Daily telegraph has tables in it. Thanks for that..[/quote]



Although there are limits on ISA

[HotshotBobbyW]

Stuff pensions this lot expect you to pay more for longer and get less back in order to balance their books , well stuff them i'm out of any pension and will enjoy 'my' money now, the state can deal with me when i'm ready .

[millavanilla]

I had a workmate who was single, lived with parents, had a good relationship with them, (pampered) and his hobby was saving money...he didnt smoke, but liked a drink,... the rest went in the bank..EVERY week...over a very long period of time,(20+years) hed saved over 130,000..and for whatever reason, put almost the lot in icelandic banks...hes got very little left now..and, im told, has gone round the bend...its all about lasting the distance with money ..leave it to your wife and the new bloke will be very thankful that you were a hard worker...leave it to your kids and will be rinsing a steel trough in a nightclub...leave it in an isa and the government will decide what to do with it...leave it in a pension an its
Fu..ked..no pockets in shrouds...

[Galant]

50 year olds retirement age is about 67
40 year olds is about 68
30 year olds is 69 and in your twenties it's 70
If you want to control your own retirement age then put money away for the future - if you want the Government to own your future then piss it up against the wall - good luck!

[crashbang]

Got a small pension from the Army
Got a chrystalised pension pot (spelling of about 80k Took 20 out 1/4 when I was 56
opted out of serps years ago when it first came about (so don't know where I stand with that)
Then there will be old age pension.(Thats changing)
?220 Month goes in company pension scheme.
Will they all pay out automatically?
I keep putting things off because paperwork is my worst nightmare. :? (Though I am good at being a smart ass)

[sawmiller]

spot of research/reading on the following site below - view external link (http://www.hl.co.uk)

[rich76]

Galant. Sorry mate but from a tax perspective pensions are more efficient than ISAs even for a BRT. Although that doesn't necessarily mean better. An example would be a BRT who has saved 100k in a pension and 100k in an ISA. Forget investment performance for this; the amount the person has actually paid into the ISA is 100k while they have actually paid only 80k into the pension, the other 20k is tax relief on payment into the pension.

At retirement of 65 and assuming the person's only other income is state pension of let's say 7k per year, they would take 25% of the pension pot as a tax free lump sum while the remainder would provide an income. If this is less than 3.5k per year then no tax would be paid on it due to age allowance. So from a tax perspective only and using a very basic and generalised example, you are 20k better off with the
pension. The major issue for me is the lack of flexibility with a pension compared to an ISA and also what happens to your capital on deat

[kempo]

For those on reasonable incomes,it should not be a question of either or but you should aim at having a variety of long term savings pots which should include pensions and ISAs.

The big advantage of pensions as explained is their tax status so a minimum of an extra 20 per cent free money is being invested on top of an employers free contribution.

The pension should be actively managed and reviewed annually with a view to increasing contributions when possible.

It's extremely important with a private pension to take out the risk in the last few years and not expose the pension to the risk of the stock market.

For those like myself with a public sector pension then count your blessings and make sure that you never ever ever opt out.

Im in the fortunate position to have a generous NHS pension to come which is not subject to investment risks and I've been in a position to have a variety of savings pots.

Back to crash...it seems that you have made the classic mistake of putting your h

[rich76]

Crash,

Kempo is right, although it appears that the decision you are considering is what to do with your pension pots as opposed making further contributions?

Definitely don't make that decision (or other pension decisions) without advice. An annuity purchase is final and once in it, you can't get out of it (in most cases).