Husband has a better pension than me should I be worried?

[Nopensiopottopiissin]

So this is about pensions. I took a private pension out in my mid twenties (I'm 40) as I was self employed. I paid in for about eight year roughly £100 per month, then I got a job so I took a work pension out instead which was a similar amount but employers doubled it. During this time I got married after our son was born I became a sahm I didn't pay into a pension for 5 years. This as something we before wanted and it's allowed my husband to build his career. The last year I've worked part time and only paid about £2o a month into the pension which again employer doubles. My dh and I were talking last night and I discovered that he pays £350 a month into his pension which his employer matches and he's been doing that for about 12 years. We have joint income so everything goes in same pot. I now feel a bit concerned that my pension is going to be very small compared to his which is fine unless we split up or he dies. Then I might be screwed. I am annoyed because we can't afford for me to pay a similar amount we literally wouldn't have enough left to pay bills. So is it reasonable that he gets such a large chunk of our money to pay into a pension pot and I don't? Is there anyone else in a similar situation to me?

Well if you’re happy together I don’t see the problem with you topping up bills buying cars etc out of your inheritance it’s only an issue if you’re not happy is there more to this?

@Abigail12345654321

Those claiming he is sneaky and sly are bonkers!

Employer pensions schemes deduct the pension contribution pre-tax. He hasn’t been running off with £350 a month. He’s probably always paid into it and never given it a thought - as would any sensible person.

I know. So many people not understanding pensions.

It's deducted at source so he's not exactly syphoning it off. He's being sensible and sounds like he's paying the max he can which is to be applauded. Imagine the responses if OP said he was earning a good salary but only putting £50 a month into his pension pot. "Why is he being so selfish and not thinking of the future."

I would always assume that the higher earner in a couple will be paying more into their pension, I can’t see that he’s doing anything wrong? If you stay together you’ll benefit from it as you say you share all money. If you split up it’ll be taken into account in a financial settlement. Would you rather he wasn’t paying into his pension scheme??

[quote Nopensiopottopiissin]@whiteworldgettingwhiter I never knew as I just see his wage after tax, pension etc it's only caus he was discussing increasing he mentioned it. The thing is we lost my mum two years ago and my inheritance has topped our bills up if needed, bought his car and paid for house repairs. [/quote]
Ah, sorry - I didn't realise that his pension contribution came out of his salary first. I still think you need to chat about all your finances, and it would help to see a pensions advisor.

Are you thinking it's unfair that he is amassing a big pension and taking some of your mum's inheritance?

OP I'm in your husband's position. I pay in 12x what my DH does. Given how much each of us earns and our employers' pension schemes, we are better off putting the money in my scheme than his.

I'm worried about what would happen if I die first as my pension will be our main income, and he would only get 50% of it. The only way to balance it out would be to reduce my contribution and increase his, but we would be missing out on free money. We are also trying to save in LISAs so that he can access that if needed.

I don't think this is sneaky at all, either. My DH is starting a new job and I think it's 5% unless you opt out. I work PT, pay NI and have a small Nest pension. If I found out he'd been paying in £350 a month out of his gross for 12 years and we'd never missed the money I'd be delighted!

As an aside (but I think relevant question), if the ops dh died and she received part of his pension (as seems to be standard with a lot of pensions), does that stop if she remarried/moves in with someone else? Or do a change of future circumstances not change your entitlement?

I don't think dh and I have ever discussed pensions. All remaining income after deductions go into a shared pot. Our pensions are a joint asset of the marriage anyway, and set up so the other gets it in the event of a death, but as for the monetary value, well, its just not something we each care about.

@Abigail12345654321

Those claiming he is sneaky and sly are bonkers!

Employer pensions schemes deduct the pension contribution pre-tax. He hasn’t been running off with £350 a month. He’s probably always paid into it and never given it a thought - as would any sensible person.

I agree. I've just checked and pay a similar amount into my workplace pension. If my partner had the temerity to call me sly then they could get to fuck.

@Cleothecat75 good question!

@Cleothecat75

As an aside (but I think relevant question), if the ops dh died and she received part of his pension (as seems to be standard with a lot of pensions), does that stop if she remarried/moves in with someone else? Or do a change of future circumstances not change your entitlement?

It stops if the spouse remarries. (in local government schemes anyway).

He's been paying £350 per month of joint money into his pension for 12 years and never told you???? Where did you think the £350 was going? That's really unfair and sneaky.

Why is this being sneaky?
Unless hes paying £350 extra
This would be his required % contribution
Did the Op really think that he would be working FT and contributing nothing to his pension?

@Cleothecat75

As an aside (but I think relevant question), if the ops dh died and she received part of his pension (as seems to be standard with a lot of pensions), does that stop if she remarried/moves in with someone else? Or do a change of future circumstances not change your entitlement?

Depends on the type of pension.

If it's Defined Benefit/Final Salary then some schemes will stop the pension if she lives as a married couple with someone else, or on the marriage itself. Other schemes will continue to pay the spouse pension regardless.

If it's a Defined Contribution/pot of money, then the pot can be passed to OP - how this is done depends on what the DH does with the pot if he's reached retirement or if he dies before retirement. Or it can be split between a number of beneficiaries (children for example?) it's then largely up to OP how she takes the money. If the DH opted for an annuity but didn't specify a spouse pension (since he can choose to provide a spouse pension or not) then his pension will die when he does. Usually with DC pots remarriage doesn't effect any spouse benefits.

The whole is it sly, is it not sly depends on each couple and their circumstances.

For example, DH and I both share money. All into one pot and we both use it as and when we need to. At the moment we need as much money as we can get and have other areas which are more important to use our money for before we consider pensions. If it was a choice to pay £350 or nothing, then of course it's a no brainier. However, if he is paying more than the minimum and didn't tell me I would be annoyed because we have other financial priorities. That's not to say I wouldn't think paying £350 is not financially savvy, just that as we share our money it should be a discussion we have as a couple. Likewise, if I wanted to spend £350 either as a one off or a regular payment I would run it past DH first.

I know other couples have their own money and just pay their share of bills into one pot, in which case it would be up to DH how he uses his leftover money.

@whiteworldgettingwhiter

He's been paying £350 per month of joint money into his pension for 12 years and never told you???? Where did you think the £350 was going? That's really unfair and sneaky.

I'd make a joint appointment with a financial advisor and talk about pensions and planning for retirement - how much money you will need for the lifestyle you want, and discuss the value of both your pensions. Maybe the pensions advisor will be able to suggest how to make this more equal.

But I'd be really angry with my h if he did this.

You’re not quite right in your understanding before you get really angry if your DH did the same

Pensions are deducted at source by employer pre tax. That’s what make them so tax efficient. Whilst £350 is going in, if he is a higher rate tax payer then it’ll cost him about £200 of his take home pay. His take home pay is “joint income”, the OP can see.

It makes a lot of sense if one partner in a marriage is higher rate taxpayer to “salary sacrifice “ into their pension as you get more tax benefit-free money, especially as you come closer to retirement

The question here is more that it wasn’t discussed and agreed, that it leaves the OP in a very vulnerable position not to have her own pension especially as if he dies in retirement once the pot is crystallised or it’s a defined benefit scheme she’ll only get a widows pension not his full sum. And if they divorce she’ll have to go through hassle of a pension sharing order. Much better to even things up more even though the tax gain will be less.
And certainly there is good reason for op to be pissed off if they struggle to save more into her pension, as he is sacrificing so much salary

It makes good sense to pay as much as you can into a workplace pension due to the tax relief and free money put in by employer. I will have state pension and small private pension but DH has been public sector most of his working life and has a really good pension. He now has apart time job in retirement and once again is paying in as much as he can and getting the benefit of employers top up, by the time he retires he is fully retired there will be another nice lump sum to come from that too. He did not tell me he intended to do this before he did, it is his decision but as all money is joint we share any inheritances or lump sums that come in. It is really a non issue because in the event of death or divorce you would have entitlement in any event.

I’m in similar situation as DH works FT and has a good pension while I am a SAHM. The way I see it is he is saving for both our retirements at the moment and I will add to it when I get back to work. In the unlikely event of divorce I would be entitled to share his pension. He’s over £60k threshold so we are not entitled to child benefit (which really annoys me, don’t get me started) but I still ‘claim’ it and opt for non-payment as then you get NI credits towards state pension. DH also has life insurance so if he died the house would be paid off etc.

@StEval

He's been paying £350 per month of joint money into his pension for 12 years and never told you???? Where did you think the £350 was going? That's really unfair and sneaky.

Why is this being sneaky?
Unless hes paying £350 extra
This would be his required % contribution
Did the Op really think that he would be working FT and contributing nothing to his pension?

She would never have seen the£350. Not unless she was reading his payslips in detail. His take home income would be about £200 less, but if he’s gradually increased this over the years in line with annual pay increases, she’d have to have been a tax expert to have known this

She would never have seen the£350. Not unless she was reading his payslips in detail. His take home income would be about £200 less, but if he’s gradually increased this over the years in line with annual pay increases, she’d have to have been a tax expert to have known this
Seriously?
She sounds completely naive if she has only just realised her DH was paying into his pension on a FT wage.
This is exactly the type of thing that should be discussed and sorted out before someone decides to be a SAHP not 5 years down the line and then blaming her DH.
Its frightening !

@Motnight

How have you only just realised this? If he's been deliberately keeping this from you then that's really worrying.

This.

That is a lot of money to put into a pension if finances are so tight.

What a really sly thing to do.

Honestly some of the replies here are really bad. He's paying into a pension- it's what you are supposed to do. The idea he is deliberately keeping this secret is bonkers. I'd be more annoyed if I discovered my husband hadn't been paying in.

It's sensible for the higher earner to pay more, if you have joint finances. What happend if he dies depends on the sort of pension- assuming it's a defined contribution scheme it can be passed on if he dies before he retires. When they retire, OP and her husband should work out the best thing to do- drawdown or an annuity or a mix- taking into account the need to provide an income for the surviving spouse. If it's defined benefit, check the terms.

They should both have up-to-date wills.

If he dies most employers have a death in service benefit that will pay out a lump sum.
He should have nominated benefactors upon death who the plan would transfer to.
If you split up, (assuming you're married) than you will be entitled to a portion of his fund.
If he is a high rate tax payer then it more beneficial for him to make larger contributions as the pension payment is deducted before tax. (Also if your salary is above the child benefits threshold this can reduce it below the 51k cut-off)
If you are at equal tax levels maybe you could even out the payments to each pension fund.

Another one saying he's been sensible not sly. And this -

I literally have no idea of how pensions work.

• is no one's fault but your own. So at least one of you have some decent provision for retirement and thanks to being married, it's money you'll both live off whether you stay together and share it, or split up/he dies and you get a share of it.

I'm in a similar situation except that I did know that was the case - and surely you didn't think he was only paying a tiny amount into his or you'd both be screwed. In my case, my DH is a civil servant so I've always been super glad that he has a decent scheme and is amassing a good amount with employer contributions. Meanwhile, like you, I had a private pension in my 20s which I've still got but only pay a tiny amount (£50 a month) into through my 30s and 40s, as I had DC and am now self-employed. As my earnings are ramping up now, I'm starting to pay more into my scheme and looking at the best ways to maximise contributions through my 50s and 60s till retirement. But it helps to know DH pension is sorted. No plans to split up and there's no way he'd treat it like his money not ours (if your DH would, that's a bigger problem!), and if we do split up, I'll be going after his pension pot with a vengeance, ha ha.

So I wouldn't focus on the sly thing unless your DH really can't be trusted. It sounds like you've just never given it a thought and need to, so it's good that you are doing and good that he's more on it. Don't be worried, be proactive!

I don't understand the outrage here. I paid into a local government scheme and retired early, so did my DH. He died earlier this month, and now I am entitled to a surviving spouse's pension. At various times one of us earned more than the other, when we started in local government it was a condition of service that we joined. The money was taken from salary and that was that. I never worked part-time or was a SAHM because I knew that eventually we would be OK financially. Sadly he has left me too soon.
Your DH is saving for YOUR joint retirement. Whether he has the option to opt out or not, I would say he has behaved responsibly in making provision for you, particularly if there are death in service benefits.

Oh, and I hope you have insurance to pay the mortgage if one of you dies before that is out of the way.