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How much do you pay into your pension as a percentage of your salary?

(37 Posts)
AntoinetteCosway Sun 09-Feb-14 14:23:36

DH's new employer pays in 7% and we're also paying in 7%. We're both 30. I'm a self-employed tutor so my teacher's pension isn't getting anything at the moment. We don't know whether to pay more into his to make up for the fact that mine's not being fed. I earn very little (less than £10k a year) and he earns £39k. After child care vouchers, tax, NI and 7% pension his monthly income is under £2k a month. Mine varies a lot-sometimes it's only a couple of hundred and sometimes more depending on the time of year. We are on a tight budget so to lose any more of his salary to the pension would make life quite tough but I'm worried about it being even tougher when we're old!

PrincessOfChina Wed 12-Feb-14 21:08:37

I pay in 8% and the company pay in 8% I think. DH has no pension (he's consistently worked for tech start ups and we think private pensions are a total waste at the level we can afford to invest).

My pension is a kind of final salary thing. Not sure of the name.

Lonecatwithkitten Wed 12-Feb-14 21:00:18

I am self employed and total amount in is 16.7% of my income. I have paid in nice the day I started work at 24. However, I have had very smart advice and have a SIPP that owns one of my business premises and that rent is 60% of that contribution.
I then have a WRAP as well. Due to good a advice my pension has quadrupled in 5 years. It is not just how much you put in, but what you do with it.

WoodBurnerBabe Wed 12-Feb-14 20:49:53

I pay in 15.8% and my employer pays 2%, but this will be going up in April to 6%. It's just a stakeholder one, but I've been averaging 17% since I was 23, so am hoping I won't be too skint when I retire...

TalkinPeace Wed 12-Feb-14 20:47:41

I quite agree that the new schemes are better, but the fact that the industry blocked the cap last month speaks volumes

and you talk about large funds ...

my limited company has one employee ... me
DH's limited company has one employee .... him

my other employer has six employees, 2 already in a scheme, one over 65, one earning under £4000 a year and 2 eligible for NEST scheme

a goodly proportion of employers have less than 10 employees, many of whom are part time
which schemes are offering dirt cheap rates to employers with less than five employees ?
of whom there will be tens of thousands in the next few years

Notmadeofrib Wed 12-Feb-14 20:38:55

The calculation is from the gross salary but the amount is taken either from the gross or net depending on the type of pension.

If it's a PP the government gross up by the basic rate of tax and pay that to the pension provider, furthermore your basic rate tax band is increased by the pension contribution to refund any higher rate tax. (So yes you get the tax back but it's not going to make it higher than say the 5% of the gross salary).

Not all pensions are equal.

Talkinpeace each I know you hate pensions, but 1.5% charges is a misleading figure for many post RDR pensions. I know not many are going to be that up to date, but many employer run schemes will have been changed, or will be changed quite soon. People should check the terms and try and influence decision makers. The old stakeholder pensions are frankly out of date and they are the 1.5% contracts. I write 0.4 & 0.6% contracts every day of the week. (Large funds will buy you 0.2% charge).

TalkinPeace Wed 12-Feb-14 19:09:56

no, the employer does

Quinteszilla Wed 12-Feb-14 19:06:45

So if he gets 6.5 k per month, at 5%, that will be £325 subtracted from the net figure, so just under 3900 net? Just using hypothetical figures.

Will the government add any to this?

Leviticus Wed 12-Feb-14 18:56:40

I pay 16.25% (12.25% standard + 4% additional voluntary contribution to retire a bit earlier). Employer does not disclose how much they pay except it is 'significantly over' 11%.

TalkinPeace Wed 12-Feb-14 18:56:24


Quinteszilla Wed 12-Feb-14 18:55:45

Do you calculate this from the gross or the take home salary?

Dh is currently considering two employment offers. One matches his contribution up to 5%, the other matches his contribution up to 8%.

I am trying to figure out whether this will be taken from the net or gross figure (we have never had a pension before!!)

TalkinPeace Wed 12-Feb-14 18:52:09

if you are in the LGPS your employer alsp pays in 19.8% of your salary

only at those levels (nearly 1/4 of earnings) will pension contributions lead to a decent income later

so people putting away 2 or 3 % with fees on the fund running at up to 1.5% of the fund every year are in for a rather nasty shock when they stop work

Around 7% I think (local authority)

LydiaCrawford Wed 12-Feb-14 18:37:19

I pay 8.8% and my employer pays 14.1%
DH pays 10% and his employer 10%

Supermum222 Mon 10-Feb-14 12:17:25


I am NHS. I have paid into my pension since 1996 although the last 9 years I have been part time (kids!!). I am not sure whether to pay more in or not (our mortgage finishes in 3 yrs). I will probably be doing more hours soon so could afford to throw more at it but I always got the impression that AVC's were expensive and that money would be better invested elsewhere??

AntoinetteCosway Sun 09-Feb-14 20:26:09

Nice mistake to make though grin

bigkidsdidit Sun 09-Feb-14 18:35:27

Oh, ok. Mine is final salary.

I put above that I pay 7 and my employer matched it. My mum (in the same scheme) just informed me I pay 7.5% and my employer pays 16%! Was I wrong grin

Notmadeofrib Sun 09-Feb-14 18:31:59

DC pensions are transferable to a spouse on death at 100%.
Only FS or DB funds can restrict death benefits

AntoinetteCosway Sun 09-Feb-14 16:07:11

I have a Teacher's Pension but I think I can only contribute to it while I'm employed by a school which is a pain in the neck. I will call them and double check though.

upyourninja Sun 09-Feb-14 16:06:04

Not for profit company here - they pay 10% and I currently don't pay any. I started paying in at 22 smile

LoveIsTheDrug Sun 09-Feb-14 15:57:33

Same as tiredemma - nhs pension.

Figster Sun 09-Feb-14 15:55:21

Private sector employer here I pay 3% they pay 6%

TalkinPeace Sun 09-Feb-14 15:53:19

If you have access to a " defined benefit " pension :
teachers / NHS / Civil service / MOD
and a very few companies still provide them
pile in as much money as you possibly can, buy added years, do whatever

if the only pension you have access to is a " defined contribution " pension, make sure all your other tax efficient savings (ISAs in particular) are filled up before sinking funds into an almost unregulated moneypit.

The max charges on DC schemes were meant to be regulated from 31st March this year, but enough of the men in suits took enough politicians out to lunch that its been deferred again ....

AntoinetteCosway Sun 09-Feb-14 14:43:54

nul that really is good!

nulgirl Sun 09-Feb-14 14:42:21

Finishing my point

although everyone else hates them (a bank) they are good employers.

AntoinetteCosway Sun 09-Feb-14 14:42:12

bigkids that is a really good point. We definitely need to look into that-it hadn't occurred to me.

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