Age you started pension

[Welshbeef]

I started mine on my 18th birthday... dad forced me to as he had done so himself and I have paid in full ever since and were talking about 12-15 years here of pension payments.

Luckily for me some of those years were final salary while others were not.

At my last place of work a female had been there for 16 years where final salary had been offered all that time - she had never taken it... reason she couldnt afford the 3% per annum... I asked her on her first annual payrise why did she just not start it then... answer didnt think and noone really pushed me into it & i got lazy. At that number of years she would be not far off 50% of her current salary on Final salary - she was gutted.

[V8mate]

Where's the 'Pensions are a rip-off scam and I'm staying well clear' option?

[cj_eds]

Probably the same day alot of folk on PH will say: the day they walked out of uni and into the real world and the shock of their first job!

[Timmy35]

V8mate said:

Where's the 'Pensions are a rip-off scam and I'm staying well clear' option?

[esselte]

V8mate said:

Where's the 'Pensions are a rip-off scam and I'm staying well clear' option?

27 years ago when I started my first final salary scheme they were OK...

[patmahe]

Timmy35 said:

V8mate said:

Where's the 'Pensions are a rip-off scam and I'm staying well clear' option?

Just out of interest, whats your alternative?

[1066]

Started paying into one at work when I left full time education aged 21 or so.

[Timmy35]

patmahe said:

Timmy35 said:

V8mate said:

Where's the 'Pensions are a rip-off scam and I'm staying well clear' option?

Just out of interest, whats your alternative?

Full ISA allowance every year since they came out. Some land/property. A few bits and bobs stashed here an there. Yes I know ISAs aren't banruptcy or death proofed but I prefer the flexibility. I might do a small SIPP lump sum at some stage if I ever start a family.

[XJSJohn]

patmahe said:

Timmy35 said:

V8mate said:

Where's the 'Pensions are a rip-off scam and I'm staying well clear' option?

Just out of interest, whats your alternative?

personally??? invested as much as i could into property on a rising market.

Would love to say skill, but 90% luck and circumstance later, sold everything up at top of market (or as near as damn it) and invested with a very wise (mate) IFA from which i have had a rather comfortable yield for the last 24 months.

With luck and lessons learnt, the same cycle should equate to a better return or my own stupidity if it goes wrong rather than a lack of control / Bob Maxwell routine.

[Welshbeef]

patmahe said:

Timmy35 said:

V8mate said:

Where's the 'Pensions are a rip-off scam and I'm staying well clear' option?

Just out of interest, whats your alternative?

Anyone who is a higher rate tax payer would frankly be silly not to have one i.e. you pay in £60 the govt pays in £40 - what other investment give you 66.7% return? Your only taxed later & if you take out 25% of your pension pot its tax free (everyone should do this) thereby lowering future taxes from your pension "salary"/annuity.

One place I worked I paid in 3% they paid in 27%!!!! Another I paid in 4% they paid in 15% but more recently its been me 4% them 6% so if I were not to take it I would lose out on 6% from my employer (I wonder of those who do opt out ask if they can have a higher salary to counter the fact your not costing them anything for the pension?) plus the 40% from the govt.

[Wings]

30 years ago, and for tax reasons I will not be drawing my pensions, instead leaving it tax exempt/free and out of my estate for my children to reap the benefit.

[V8mate]

It's not so much the input end which is the problem, rather the output.

You (and if you're lucky your employer) put loads of cash into your pension for years on end. Then, as you retire, you put the whole saved (and grown) sum onto the 3.45 at Kempton. Yep, enter the annuity - a short odds bet between you and the insurance company. They bet you die; you bet you live. (You're ahead of me already, right?) Oh yes, you die!

So unless all 4 of your grandparents lived to 90+ the odds are reducing all the time of you being on the winning end of that bet. Die at 65 years and 1 day and your estate gets.....nothing!

Create your own investment fund for retirement and, should you opt to leave this mortal coil early, at least your kids will be able to put on a good bash to see you off.

[Welshbeef]

[/quote]

Full ISA allowance every year since they came out. Some land/property. A few bits and bobs stashed here an there. Yes I know ISAs aren't banruptcy or death proofed but I prefer the flexibility. I might do a small SIPP lump sum at some stage if I ever start a family.
[/quote]

Firstly I do both ISA & Pension to the max & once married that will be Mrs Isa max me max & both pensions max.

With the ISA's though your paying in taxed income - thats its con vs pension which is deferred tax + your foregoing the company contributing towards your pension.

Property is a good long term investment i.e. min 10 years or expect to double its value every 25 years. However clearly buy at the right time for the right price is key.

Another one which is great for higher tax rate payers is premium bonds you can put in up to £30k each so build it up over time and ave payout is IIRC 5% net which you can certainly not earn risk free so its a fun ish gamble and tax free.


Another alternative is to overpay what 6%+ of your gross salary would be into your mortgage overpayment. Again risk free investment and you can get your hands on it when ever you like.

[Maxf]

OK, opening myself up for a pisstaking here...

Ive got an old HSBC pension which my old man started for me at 18. Currently its not worth a lot and I'm not adding to it anymore (have since moved to uni, then to proper jobs with proper pensions ). What is the best thing to do with this? Its only worth about £15k and I have 34 years until retirement.

I know I should see an IFA, but for a 15k pot it doesnt seem worth their time and I'm assuming their fees will quickly turn it into a £12k pot. But 34 years or growth COULD net a semi decent amount.

[Welshbeef]

V8mate said:

It's not so much the input end which is the problem, rather the output.

You (and if you're lucky your employer) put loads of cash into your pension for years on end. Then, as you retire, you put the whole saved (and grown) sum onto the 3.45 at Kempton. Yep, enter the annuity - a short odds bet between you and the insurance company. They bet you die; you bet you live. (You're ahead of me already, right?) Oh yes, you die!

So unless all 4 of your grandparents lived to 90+ the odds are reducing all the time of you being on the winning end of that bet. Die at 65 years and 1 day and your estate gets.....nothing!

Create your own investment fund for retirement and, should you opt to leave this mortal coil early, at least your kids will be able to put on a good bash to see you off.

Not quite true as the annuity would pass onto your wife or your child at a vastly reduced rate (if a child).

Some dodgy pension funds do not decrease the risk factors as you get older/you forget to tell them for less risk or hold more bonds than equity then when you retire the market crashes and your pension is a fraction of what it had been a year before (in some cases the person should have retired a year ago p*ssed the money up the wall and been miles better off).

Hindsight is a wonderfull thing.

[V8mate]

Welshbeef said:

V8mate said:

It's not so much the input end which is the problem, rather the output.

You (and if you're lucky your employer) put loads of cash into your pension for years on end. Then, as you retire, you put the whole saved (and grown) sum onto the 3.45 at Kempton. Yep, enter the annuity - a short odds bet between you and the insurance company. They bet you die; you bet you live. (You're ahead of me already, right?) Oh yes, you die!

So unless all 4 of your grandparents lived to 90+ the odds are reducing all the time of you being on the winning end of that bet. Die at 65 years and 1 day and your estate gets.....nothing!

Create your own investment fund for retirement and, should you opt to leave this mortal coil early, at least your kids will be able to put on a good bash to see you off.

Not quite true as the annuity would pass onto your wife or your child at a vastly reduced rate (if a child).

Some dodgy pension funds do not decrease the risk factors as you get older/you forget to tell them for less risk or hold more bonds than equity then when you retire the market crashes and your pension is a fraction of what it had been a year before (in some cases the person should have retired a year ago p*ssed the money up the wall and been miles better off).

Hindsight is a wonderfull thing.

When did children become beneficiaries of pension annuities? (I'm not suggesting you're wrong, but I thought that spouse was the only person who could continue to benefit after death) Would be interested to know how that has changed

[okgo]

Have not started yet.

But I have a substantial inheritance in the family, so I have not given pensions so much thought.

At the minute I don't have enough free cash to do it, but when I get off the ground in whatever it is I do I hope to be contributing by 25

[V8mate]

okgo said:

Have not started yet.

But I have a substantial inheritance in the family, so I have not given pensions so much thought.

At the minute I don't have enough free cash to do it, but when I get off the ground in whatever it is I do I hope to be contributing by 25

Ah - the wise words of youth? Have a few from a wise old(er) guy. There's no such thing as 'enough free cash'. As you earn more, the cars get prettier (not to mention the girls), the suits start to fit a bit better and the food tastes a whole lot nicer. And there's still not enough free cash

[Welshbeef]

V8mate said:

okgo said:

Have not started yet.

But I have a substantial inheritance in the family, so I have not given pensions so much thought.

At the minute I don't have enough free cash to do it, but when I get off the ground in whatever it is I do I hope to be contributing by 25

Ah - the wise words of youth? Have a few from a wise old(er) guy. There's no such thing as 'enough free cash'. As you earn more, the cars get prettier (not to mention the girls), the suits start to fit a bit better and the food tastes a whole lot nicer. And there's still not enough free cash

+1 all you need to do either when you start your proper job is get a pension with it or if you didnt when the annual pay rise comes which should be 3-5% start your pension then so for 2 years ignoring promotions your salary will stay the same.

The longer you leave it the more you have to put away to get the same outcome.

[Timmy35]

Welshbeef said:

The longer you leave it the more you have to put away to get the same outcome.

Have you just become an IFA and your touting for business or something?