New Employer - Private Pension
Discussion
Guys, I'm a little lost.
I'm about to turn 23 and for the last 3 years I have worked for a local authority. When I commenced employment with them I considered it best not to join the pension scheme as I couldn't see myself staying with them for more than five years.
Roll on a few years and I've just handed in my notice.
I'm due to start with a new employer who offer a pension with a group called 'Bluefin'.
My question as a financial leper is this;
Are pension schemes worthwhile these days and if so, are some better than others?
A little about myself.
- I plan to stay with this new company indefinitely. Chances are I will emmigrate in about 10 years but they have offices around the world. I have no reason to see myself finding an alternative employer any time soon.
- The other option I guess would be to make provision for old age buy saving and wise investments. I have no issue with this as I love the thrill of saving, though I think all I'll end up with is a big pile of cash as I don't like to 'play' with money.
Can anyone give any advice?
I'm about to turn 23 and for the last 3 years I have worked for a local authority. When I commenced employment with them I considered it best not to join the pension scheme as I couldn't see myself staying with them for more than five years.
Roll on a few years and I've just handed in my notice.
I'm due to start with a new employer who offer a pension with a group called 'Bluefin'.
My question as a financial leper is this;
Are pension schemes worthwhile these days and if so, are some better than others?
A little about myself.
- I plan to stay with this new company indefinitely. Chances are I will emmigrate in about 10 years but they have offices around the world. I have no reason to see myself finding an alternative employer any time soon.
- The other option I guess would be to make provision for old age buy saving and wise investments. I have no issue with this as I love the thrill of saving, though I think all I'll end up with is a big pile of cash as I don't like to 'play' with money.
Can anyone give any advice?
Ask what the deal is. You would be insane not to join if they also contribute. Usually the minimum is to pay you an extra 5% salary tax free into the pension.
Also ask if you can salary sacrifice, basically that means take a lower salary and save tax free, sometimes they will match you 1 for 1 up to a certain point.
Basically you want to max out the free cash even if it means paying more in yourself.
Now the second part is figuring out what to invest that into. You can ask if they will offer the same deal if you open a SIPP, then you get to choose, or just let it head into the company one and check if they allow transfers out. If so at what cost etc.
Actually there is a bit to think about.. you might want to speak to someone.. First things first is to get a hold of the pension scheme terms etc.
Also ask if you can salary sacrifice, basically that means take a lower salary and save tax free, sometimes they will match you 1 for 1 up to a certain point.
Basically you want to max out the free cash even if it means paying more in yourself.
Now the second part is figuring out what to invest that into. You can ask if they will offer the same deal if you open a SIPP, then you get to choose, or just let it head into the company one and check if they allow transfers out. If so at what cost etc.
Actually there is a bit to think about.. you might want to speak to someone.. First things first is to get a hold of the pension scheme terms etc.
Are you having a laugh? Bluefin is a well know employee benefits, pensions and wealth management consulting company: you're going there and asking PHers for their opinion about a pension plan?
Advice must be that if you're going to opt out then you're forfeiting the employer's contribution: good for them, not for you. I never understand why employees do this (assuming they can afford their own contributions). There's no way empoyees are likely to do better on their own. People say things like property are a better bet but I remain unconvinced in the long term. You've already missed out on 3 years worth of pension accrual for, IMHO, an incorrect reason.
The sooner people start pensions the better...each missed year will cost an increasing amount to make up. We all retire sometime.
I anticipate the wrath of other PHers about my view...but I'll be away on hols!
R.
Advice must be that if you're going to opt out then you're forfeiting the employer's contribution: good for them, not for you. I never understand why employees do this (assuming they can afford their own contributions). There's no way empoyees are likely to do better on their own. People say things like property are a better bet but I remain unconvinced in the long term. You've already missed out on 3 years worth of pension accrual for, IMHO, an incorrect reason.
The sooner people start pensions the better...each missed year will cost an increasing amount to make up. We all retire sometime.
I anticipate the wrath of other PHers about my view...but I'll be away on hols!
R.
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