Looking for a personal pension

[BeMintFatball]

I have a 23 year old daughter who has hidden disabilities . She has worked for the same employer for nearly 3 years..

her contracted hours are only 8 per week, although she does more to cover other staff holiday and sickness. Paid minimum wage. She does not earn enough to be invited the company pension. I think she is entitled to ask to join but the employer would
not need to made any contribution.

She doesn’t earn enough to pay tax. She does pay National Insurance. Does that meet she is paying in for her state pension, I assume it does.

She lives with us, we are supporting her. Looking ahead she will be a very impoverished pensioner unless she starts paying for her future now. I think £25 per
month into a personal pension is better than nothing.

Which pension provider should we consider?

Sipp.

Self invested personal pension ,many platforms offer them

We use hargreves and landsdowne .

Open it with 100 I think minimum .

I think she can pay in up to 2800 a year but don't quite me and the gov add about 700!!

Also worth opening a stocks and shares ISA as well.

Invest both in cheap index funds perhaps one global ,one UK and one USA.

I think you should be getting professional advice on this one.

depending on how much she earns, her employer may have to contribute if she asks to join the workplace scheme.

from HMRC

If you’ve voluntarily enrolled in a workplace pension
Your employer must contribute the minimum amount if you earn more than:

• £520 a month
• £120 a week
• £480 over 4 weeks

They do not have to contribute anything if you earn these amounts or less.

so I would check this first.

My SIPP is with a Scottish Widows. You choose your level of risk.

If she earns over £6241 a year, she has a right to join her workplace pension scheme although the company are not required to pay contributions. If this is is possible, i’d strongly recommend this.

if not, I’d recommend a stakeholder pension scheme. Big providers like Aviva, Standard Life and Legal & General all have decent stakeholder pensions.

SIPPS are another option but are a bit more complicated than stakeholder pensions and give more investment options etc.

Free financial advice is available from moneyhelper. https://www.moneyhelper.org.uk/en

@DelilahDaffodil how are sipps complicated? In what way ?

I have one and my DC and DH they seem extremely easy to me.

@caringcarer re risk it usually means the level of bonds (steady ) to stocks (volatile ).however buying a basket of business via an index fund and if it's global across the world and sectors and business it's not a real risk. The risk comes if you need to draw on your money and the stock market is low.

A real risk is for instance buying shares in only one or two companies.

DS is a disabled adult, living at home also. He has a SIPP with HL which we chose because of the range of investment options, but it isn't the cheapest. He has a NEST pension through work too.

He puts a big chunk of his salary into his pensions, almost all of it, as he's eligible for UC and it helps reduce his take home pay. He only needs a small amount of spending money as we don't charge him rent to live at home, and he gets PIP too. If your DD isn't getting UC and PIP you should look into it, as your own income doesn't count, it just depends on your DD's (for UC), and she may qualify for extra elements depending on her disabilities.

Your dd should be getting qualifying years for her state pension if she's paying NI, but it's best to check it on gov.uk to be sure.

@Coldally thank you for your reply. Dd earns less than £6000 meaning her employer would probably not contribute to a work pension.

DD gets highest rate PIP for mobility and care. And because we don’t charge her anything for living with us her savings have crept up. She doesn’t claim UC. We had a chat with someone at the job centre who said we should apply for UC. I had a light bulb moment that putting a chunk of savings into a pension would enable her to claim UC. With UC she could get her own home with My Safe Home scheme eventually.