Should I start a pension?

(6 Posts)
Greyhorses Thu 13-Mar-14 08:06:38

Hi,

I am in my 20s, no mortgage as yet however saving for a deposit.
My OH is a teacher and will get a good pension however this is assuming I am still with him then!

I earn a pretty crap wage with not many opportunities for progression. The top wage I can hit is 17k, at the moment I take home £1150.
I would likley go part time whilst children are young in a few years time.

My workplace is introducing the government pension. I believe I will put in around 1-3% and my employer will contribute 1%
It seems such a small amount is this even worth it?

We are struggling with the moment along with starting family, trying to get a mortgage and paying bills as OHs career is just starting. He isn't earning huge amounts yet as he is about to become an nqt.

Can anyone shed some light onto what to do for the best?
If I don't take this pension where do I put some retirement money when the time comes

Thanks

Braganza Fri 14-Mar-14 09:11:16

Yes it's worth it. It's free money from your employer; you don't pay tax or national insurance on the contributions, and will probably be able to a tax free lump sum on retirement; the investments are highly likely to grow faster than cash over time.

Given how crap the state pension is, any savings you make now will help.

specialsubject Thu 20-Mar-14 15:52:39

the pension is the obvious one due to the tax benefits. Put in what you can (without impoverishing yourself now) - it has so long to grow that you may get a nice surprise.

Buxton52 Thu 20-Mar-14 17:40:10

I am in my late 50's and must say I have not regretted contributing to a pension scheme.
I am drawing mine due to early retirement.
Sadly my husband passed away nearly 4 years ago and I will soon be entitled to a widows pension
The advice I would give is keep all letters relating to the pension carefully.
I initially got the figures relating to my husband's pension and they missed out 8 years of his service, his AVC'S and his pension bonus sacrifices.
It also said on the letter if he dies during service the widows pension would be payable from when he would have attained the age of 60 and they wanted to pay it from when I am 60.
I am 7 months younger.
They did even ask if I was sure of his starting date. I was as we met when we were 12.
Everything has now been rectified but I think I would have lost several thousand £'s had I not been able to produce the paperwork.
In my case the AVC'S were missed but I phoned and they were corrected without me having to produce the paperwork.

Sue

JessicaMary Sun 04-May-14 21:46:24

I regard the new auto enrolement pension as not worth having for low earners and you'd be better keeping the cash. You may not be in it long enough to build much up and if you don't join it when you enter the state is likely to make up the difference in your pension income anyway if your income is only state pension by then. It has been argued it's mis-selling to make the lower paid join it. I know most people won't agree with me on this.

LancashireMan Sat 10-May-14 18:22:18

The age for accessing your private pension, currently 55, is almost certain to be raised in the coming years. Means future generations won't have access until they are maybe 60 - 63. That's a long time not to have control of your dosh. New regime ISAs may be a viabable alternative investing £15,000 annually.

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